If you want to learn to be the bearer of futures, you must understand the 4 major types!

　　Anyone who has done futures trading should have heard the term futures hedging.Many people may be very unfamiliar with this term,but it is actually a special technique in the futures market.

　　Let's break down futures hedging.First,let's understand what hedging is.From a financial point of view,in order to deliberately reduce the risk of a certain transaction,and to make as much profit as possible in the process of trading.When a certain market begins to appear unfavorable to our direction,we will move from another market that is favorable to our direction.Go find the right trading opportunities and start making the right investments.

　　That is to say,at the same time,through two trades,we offset the profit and loss as much as possible to achieve the goal we want to achieve.

　　This kind of investment is actually a very technical investment.It should be known that when the market is related,the market demand for two different commodity prices will also have a certain correlation.If there is a big change in supply and demand,the prices of these two commodities are likely to fluctuate greatly within a certain period of time.

　　What if the movements of two commodities are negatively correlated?That is to say,one commodity is constantly rising in price,but another commodity is constantly falling in price.In fact,there will be no impact here,why do you say that?Because you bought one commodity's rise at the same time,and at the same time bought another's fall.In this hedging process,you always have to have one trade that is profitable and the other that is losing.Therefore,you can also well shock your risk in the market and avoid the loss of your investment.

　　There are several types of hedging.

　　The first type is the hedging of futures and spot.In fact,there are many people who are spot traders,and they especially like to hedge in the futures market.Let's take an example,maybe you are a physical seller of rebar.After you buy the rebar from the other side of the ocean,the rebar may need to go through a long period of 2 to 3 months on the way by sea.But in the past few months,the price of rebar will rise and fall with the fluctuation of the market.If the price falls sharply,spot investors will have a lot of losses.Therefore,they will go to the futures market to hedge,so that they can better avoid their own risks.

　　The second type is the hedging of the same variety in different futures markets.Such transactions are generally suitable for very large trading institutions.It is important to know that the trading systems of different countries and regions have certain differences,so the quotations of the same variety in different markets will also have relative differences,and there will also be continuous fluctuations.This gives those who want to hedge a good opportunity to quickly expand their market.

　　The third type is the hedging of the same futures with different delivery times.This method is actually a method that many people are accustomed to.For example,you may be doing the January contract now,but in order to better avoid risks,you will start to make forward investments,and you may buy the August contract,or the September contract.Because in different delivery periods,the fluctuating prices of commodities will also have certain changes.

　　The fourth type,hedging transactions of different futures commodities.This kind of hedging transaction is actually a method that many investors like very much.They will find related symbols,such as gold and silver,and hedge them.

　　Advantage 1:By hedging futures,we can reduce a lot of judgment.We only need to judge the strength of the entire futures market,not the direction of the entire market.

　　Advantage 2:It can better avoid the risk of the system.

　　Advantage 3:As an investor in our fund management,we can better achieve our stability through futures hedging,and at the same time ensure that our funds can be maximized.Most importantly,our income is also very impressive.

　　Advantage 4:It adds more certainty in the uncertain market,which can greatly reduce one's pressure.

　　Disadvantage 1:It is difficult to achieve great wealth and wealth.The growth curve of funds is relatively slow,and there will be a longer cycle.

　　Disadvantage 2:You need to have a very good understanding of the market,be able to know the attributes of a certain variety or related variety,and be able to well grasp the rhythm of the fluctuation of the entire variety.

　　First of all,we must understand that futures hedging is a relatively stable investment,so if you want to be suitable for such an investment method,you must be a relatively stable investor.

　　Moreover,it is difficult to obtain large profit margins under the condition of small amount of investment.That is to say,this kind of investment is more suitable for those who are not particularly strong in their desires.

　　Another category of people who are also very suitable for this type of investment.You must know that futures hedging requires a very good understanding of a certain variety,so under normal circumstances,if you are engaged in related industries,it is actually more suitable for futures hedging.

　　For example,you are a staff member in the rubber industry.You have a special understanding of the properties of rubber varieties,and you are very clear about the ups and downs of prices in other markets.Therefore,under such circumstances,you are also very suitable for futures.hedge.

　　The third type of person is also very suitable for futures hedging.This type of person is a relatively timid person in the process of market trading.They may not want to take greater risks,and they are also very cautious in the process of trading.Most importantly,they may not be able to withstand the ups and downs of the market.In the case of relatively weak bearing capacity,they do hedging,which can also gradually increase their bearing capacity.From another point of view,the reason why they have such a choice is because they are really hard to bear the big rise and fall of the number.The hedging of futures happens to be the most stable trading process in the entire market.

　　The fourth type of person is the huge amount of funds.For example,some investment institutions,because of their huge size.Therefore,they will carry out diversified investments,some of which are relatively stable,and this part of the investment is the best choice for hedging.

　　Therefore,to sum up,if you want to do futures hedging,you should determine your own position.