Hedge Ratio Calculator





How the Hedge Ratio Calculator Works

The Hedge Ratio Calculator is a practical and user-friendly tool designed for investors, whether you’re a beginner or a seasoned pro. Here’s a step-by-step guide on how to use it:

  1. Input Portfolio Value: Begin by entering the total value of your investment portfolio or the specific investment you want to hedge.

  2. Input Contract Value: Specify the value of each futures or options contract that you intend to use for hedging.

  3. Calculate Hedge Ratio: The calculator will instantly compute the hedge ratio by dividing the portfolio value by the contract value. This ratio represents the number of contracts required to hedge your investment effectively.

  4. Minimize Risk: Use the calculated hedge ratio to establish a balanced hedging strategy that aligns with your risk management objectives.

Scroll to Top