Why use hedging techniques to cover your risks
You prevent the market from eroding the value of your portfolio. Rather than taking a hedging position for each individual exposure, you only need to carry out one transaction involving a certain asset. This transaction is designed to offset any fall in the value of your portfolio, and can be completed with a single click. In other words, hedging can be defined as opening a new position to maintain your portfolio’s value until the market recovers, that is until the downturn is over.