Quote:
Originally Posted by PeteMoss
There's a lot of decisions around hedging and how much you are going to do it. Really depends on the risk level the owners are willing to take on. Its not as simple as everyone is going to hedge unless they are dummies.
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Which is exactly what I said (they would have done what they deemed appropriate), and that forwards are merely the simplest form of hedging (and that they likely execute more sophisticated strategies)
However, with respect to the bold, you're doing it wrong. Hedging isn't a case of taking on risk (that is speculating), it is a means to reduce/eliminate risk.
And when you are talking about reducing risk - and it's free - yes, it is dumb not to.