Hedging is the process of minimizing the risk to an investor's portfolio by minimizing their exposure to stock volatility. Index futures are the act of investing through an obligation to purchase or sell a product by a certain date. Hedging with index futures is the act of trying to minimize the investor's exposure to the volatility of futures.
Bets on future prices.
To minimise the risk of translation of foreign assets or liabilities, Futures Contracts could be undertaken. Such as Swaps OR through Hedging
You wouldn't use a futures contract for that; it would be an OTC swap contract.
The ES index represents the E-mini SP 500 futures contract, which is a smaller version of the standard SP 500 futures contract. The SPX index, on the other hand, tracks the performance of the full-size SP 500 index.
The Bloomberg futures change constantly. As of right now, the futures are mostly increasing. There are several that are decreasing like S&P/TSX 60 IX, BOVESPA INDEX, FTSE/MIB IDX, and SWISS MKT IX. BOVESPA INDEX is down the most as of right now by 930.
An index future is a "cash-settled futures contract on the value of a particular stock market index". Index futures are used in investments, trading, and hedging.
Steffen W. Tolle has written: 'Dynamische Hedging-Strategien mit SMI-Futures' -- subject(s): Hedging (Finance), Financial futures
Following the creation of organized futures exchanges between 1850 and 1900, hedging with futures eventually became an integral component of portfolio management theory.
Charles T. Franckle has written: 'The economics of anticipatory hedging' -- subject(s): Hedging (Finance), Interest rate futures, Mathematical models
Torben Juul Andersen has written: 'Currency and interest rate hedging' -- subject(s): Financial futures, Foreign exchange futures, Forward exchange, Hedging (Finance), Interest rate futures, Option (Contract), Options (Finance) 'Interest raterisk management' -- subject(s): Forecasting, Interest rates, Investments
The hedging tools are part of the risk management strategy. It uses instruments like Forward Contracts, Futures Contracts, Options Contracts, Swap Contracts, etc.
Futures contracts were designed as hedging tools for commodities trading where the buyer and seller can secure a fixed trading price in the future in order to hedge against price fluctuations. Today, futures trading is used for both leverage and hedging. Futures trading enables you to trade directional leverage as much as ten times. This means that by buying futures instead of the stock or commodity, you could make ten times the profit on the same move. However, leverage cuts both ways. You could lose up to ten times as much as well. For more about futures trading, refer to the link below.
You can find a lot of information on stock index futures from newspapers, financial magazines, on TV news, and online. You can easily go online and go to Google finance or CNBC and look at the stock index futures.
The E-mini S&P 500 index futures contract (ES) was introduced by the Chicago Mercantile Exchange (CME).
B. Thomas Byrne has written: 'The Stock Index Futures Market' -- subject(s): Stock index futures
Bets on future prices.
Claude R. Schmidt has written: 'Hedge Accounting mit Optionen und Futures' -- subject(s): Hedging (Finance), Accounting, Options (Finance), Financial futures