reverse hedge


A hedging strategy in which an investor sells short a convertible security on an underlying security already owned. This means that the underlying security is held long and the convertible is sold short, which is the opposite of a normal hedge. The investor profits when the underlying security loses value, which reduces the premium on the convertible security. A reverse hedge is a type of convertible arbitrage. also called Chinese hedge.
Browse Definitions by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
reverse greenshoe option reverse leverage