What is the primary function of hedging in finance?

Which of the following is an accurate analogy for hedging?

Why might an investor choose to hedge a stock position instead of simply selling the stock when they anticipate a market decline?

What are the two main types of risk that investors face?

Which type of risk can be mitigated through diversification?

What is the role of beta in the context of hedging?

How can an investor determine the beta of a stock?

Why are Nifty futures often used to hedge a portfolio of stocks?

What is the first step in hedging a stock portfolio?

What is the purpose of calculating the hedge value?