When someone wants to purchase a commodity or financial product in the future, they buy a forward contract now to hedge against a possible price increase. The purchase price hedge can also be understood as a replacement purchase or early purchase (anticipated purchase). – See basis, falling, replacement hedge, hedge transaction, option, commodity futures contract.
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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
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