What does Hedge mean? Read on to discover the definition & meaning of the term Hedge - to help you better understand the language used in insurance policies.
A noncorrelating investment designed to minimize known, quantified risk. Catastrophe bonds are used as hedges (albeit imperfect) to help protect insurers against the risk inherent in their catastrophic exposures. Noncorrelating investments are investments that exhibit different risk characteristics from other investments within a portfolio.
We hope the you have a better understanding of the meaning of Hedge.