Hedger

Part of speech: noun

Definitions

1. An individual or organization involved in managing financial risks by using specific tactics to counteract potential losses in their investments
2. A person or entity that protects their financial interests by employing strategic methods to mitigate risks associated with market volatility
3. A person or group that engages in protective strategies to limit financial losses from market fluctuations while pursuing investment opportunities

Etymology: The word is built from "hedge" with the agent suffix "-er," so it names someone who hedges. The older root is the hedge itself, a barrier of shrubs or bushes planted to mark a boundary or keep livestock in, and the verb "to hedge" carried the sense of enclosing or fencing in before it came to mean dodging a commitment. A hedger, in that original Middle English form "hegger," was the person who planted, trimmed or tended those hedgerows. The financial sense grew from the verb's later meaning of protecting oneself by placing bets or holding offsetting positions so that a loss in one place is cushioned elsewhere. Someone who hedges in this way is literally fencing off their exposure, much as a farmer's hedge once kept stock from straying. The image of a barrier turned into a strategy for limiting risk, and the term now covers traders, producers and investors who use that approach.

Synonyms: fencer, barricader