noun
- a row of bushes or small trees planted close together, especially when forming a fence or boundary; hedgerow: small fields separated by hedges.
- any barrier or boundary: a hedge of stones.
- an act or means of preventing complete loss of a bet, an argument, an investment, or the like, with a partially counterbalancing or qualifying one.
verb (used with object), hedged, hedg·ing.
- to enclose with or separate by a hedge: to hedge a garden.
- to surround and confine as if with a hedge; restrict (often followed by in, about, etc.): He felt hedged in by the rules of language.
- to protect with qualifications that allow for unstated contingencies or for withdrawal from commitment: He hedged his program against attack and then presented it to the board.
- to mitigate a possible loss by counterbalancing (one’s bets, investments, etc.).
- to prevent or hinder free movement; obstruct: to be hedged by poverty.
verb (used without object), hedged, hedg·ing.
- to avoid a rigid commitment by qualifying or modifying a position so as to permit withdrawal: He felt that he was speaking too boldly and began to hedge before they could contradict him.
- to prevent complete loss of a bet by betting an additional amount or amounts against the original bet.
- Finance. to enter transactions that will protect against loss through a compensatory price movement.
noun
- a row of shrubs, bushes, or trees forming a boundary to a field, garden, etc
- a barrier or protection against something
- the act or a method of reducing the risk of financial loss on an investment, bet, etc
- a cautious or evasive statement
- (modifier; often in combination) low, inferior, or illiteratea hedge lawyer
verb
- (tr) to enclose or separate with or as if with a hedge
- (intr) to make or maintain a hedge, as by cutting and laying
- (tr; often foll by in, about, or around) to hinder, obstruct, or restrict
- (intr) to evade decision or action, esp by making noncommittal statements
- (tr) to guard against the risk of loss in (a bet, the paying out of a win, etc), esp by laying bets with other bookmakers
- (intr) to protect against financial loss through future price fluctuations, as by investing in futures
late 14c., “make a hedge,” also “surround with a barricade or palisade;” from hedge (n.). The sense of “dodge, evade” is first recorded 1590s. That of “insure oneself against loss,” as in a bet, by playing something on the other side is from 1670s, originally with in; probably from an earlier use of hedge in meaning “secure (a debt) by including it in a larger one which has better security” (1610s). Related: Hedged; hedging. The noun in the wagering sense is from 1736.
Old English hecg, originally any fence, living or artificial, from West Germanic *khagja (cf. Middle Dutch hegge, Dutch heg, Old High German hegga, German Hecke “hedge”), from PIE *kagh- “to catch, seize; wickerwork, fence” (cf. Latin caulae “a sheepfold, enclosure,” Gaulish caio “circumvallation,” Welsh cae “fence, hedge”). Related to Old English haga “enclosure, hedge” (see haw). Figurative sense of “boundary, barrier” is from mid-14c. Prefixed to any word, it “notes something mean, vile, of the lowest class” [Johnson], from contemptuous attributive sense of “plying one’s trade under a hedge” (hedge-priest, hedge-lawyer, hedge-wench, etc.), a usage attested from 1530s.
The practice by which a business or investor limits risk by taking positions that tend to offset each other. For example, a business stands to lose money if the price of a commodity it holds declines, but it can offset this risk by agreeing to sell a specified amount of the commodity at a set price at some point in the future.