Meaning HEDGE RATIO (DELTA): For options, ratio between the change in an option's theoretical value and the change in price of the underlying stock at a given point in time. For convertibles, percentage of a convertible bond representing the number of underlying common shares sold against the shares into which bonds are convertible. If a preferred is convertible into 2000 common shares, a 75% hedge ratio would be short (long) 1500 common for every 1000 preferred long (short). See: Delta
More terms such as Hedge ratio (delta) in Dictionary H.
- Definition Hold:
- Examples ownership of a security over a long period of time. Hold is also a recommendation of an analyst who is not positive enough on a stock to recommend a buy, but not negative enough on the stock to hedge ratio (delta).
- Definition Highly Leveraged Transaction (HLT):
- Examples Bank loan to a highly leveraged firm hedge ratio (delta).
- Definition Holding Company:
- Examples A corporation that owns enough voting stock in another firm to control management and operations by influencing or electing its board of directors hedge ratio (delta).
- Definition Hemline Theory:
- Examples prices move in the same direction as the hemlines of women's dresses. For example, short skirts (1920s and 1960s) are symbolic of bullish markets and long skirts (1930s and 1940s) are symbolic hedge ratio (delta).
- Definition Hell-Or-High-Water Contract:
- Examples A contract that obligates a purchaser of a project's output to make cash payments to the project in all events, even if no product is offered for sale hedge ratio (delta).