Selective hedging that results in an over-hedged position may be regarded as speculative by regulators.

Question

Quizplus · Accepted Answer

If a selective hedging strategy results in an over-hedged position, it may be considered speculative by regulators as it may not effectively manage risk and may be seen as attempting to benefit from price movements rather than mitigating risk. This could potentially be in violation of regulatory requirements.

Selective Hedging That Results in an Over-Hedged Position May Be