The Math behind Hedging - Quant Trading 101

[@QuantIntuition]

Check out the next video in this playlist here: kzbin.info/www/bejne/fn-0foemZ9uinqssi=0Ew-iD1nmvTFm121 The full playlist can be accessed here: kzbin.info/aero/PL9Hyy4Quy-NGcmRHaH4MUgditox3jnDl7&si=7XYKHiG23NjqlPmq

[@dhruvil_2662]

This is such a good video. Please keep posting such content. I shared your channel with my friends.😊

[@TheMorhaGroup]

Perfect, now all you need is to know the exact outcomes of the market 👍🏿

[@randomsitisee7113]

I have an indicator for that 😂

[@TheMorhaGroup]

@@randomsitisee7113 yeah, sure you do

[@inferno38]

I read : "the maths behinf edging"

[@DerickMasai]

What an excellent video. Thank you for the lesson. Liked and subscribed. Notifications are on, can't wait for more.

[@grandson_f_phixis9480]

Thanks man!!

[@jakeaustria5445]

Thank You❤

[@Psaro78]

i legit invented a model of growth of a capital based on gambling and here I found this video, small world

[@NireshKumar-q7l]

Can anyone tell me why when calculating the EV for the first contract, we subtract the cost of the contract at the end after calculating EV, but when calculating the EV for the side bet we subtract the cost of the contract at the beginning ie we calculate what the profit and losses would be and then calculate Ev from that?

[@Joe-Joe-Circus]

Just as a note, it was a bit confusing when we introduced the side bet game because the diagram was structured slightly differently compared to the first game. The first game diagram had arrows from each die roll result to the money we would win AFTER paying the contract. The side game diagram had arrows from each die roll result to the total (NET) money we would win. To avoid confusion going forward it would be good to keep the diagrams consistent. Overall though, it was a great video

[@henningscherer4341]

But if combined: 1/6(2+3+4+4+5+6) gives you an EV of $4 (a $0,5 improvement to $3,5 without hedging) but it costs $1.

[@loganhodgsn]

I think the confusing thing is that the first graphic with the $=# on side of die gave the return value (from which you had to subtract 3 to get the profit), and the graphic for the hedge bet was initially shown with the profit. The cost was already put in on the second one.

[@gx1501996]

Any real life examples?

[@lukascho6297]

Insurance. Any insurance

[@GuRuGeorge03]

long term investingfor retirement: 50% into a 3x leveraged ETF (extreme EV and extreme variance) 50% into some bonds (low EV, extremely low variance)

[@arturlima3210]

Companies frequently hedge on future investments. If you have a company that sells oil and find a direct correlation between oil and coal prices, you can hedge on the prices by buying an opposite position in coal futures. This way you make money if oil prices go down and up, and even if it doesn't make you profit, you still have more safety in your investing.

[@Mazjet]

for example long any stock and short SPY, short spy in long term is negative EV, but as hedging good instrument for market neutrality

[@Narigopia]

BS