Also found in:DictionaryThesaurusMedicalLegalFinancialEncyclopediaWikipedia.Related to hedging:hedging betsCurrency HedgingFriendships are more likely to be successful when there is a level of space and privacy between the friends.The reason their friendship has lasted as long as it has is because they respect each others privacy. A hedge between keeps friendship green.To take an action in order to offset a potential future loss.Im not too confident that Ill get the lead in the play, so Im hedging my bets by trying out for several roles.to do something to lessen the risk of something happening; to bet against something bad happening.I want to hedge against something going wrong in the stock market, so I have bonds in my portfolio, too.We will hedge against any risk we can detect.Your friendship will flourish if you and your friend respect each others privacy.Lynne and I are the best of friends, but we often like to spend time apart. A hedge between keeps friendship green.to reduce ones loss on a bet or on an investment by counterbalancing the loss in some way.Bob bet Ann that the plane would be late. He usually hedges his bets. This time he called the airline and asked about the plane before he made the bet.John bought some stock and then bet Mary that the stock would go down in value in one year. He has hedged his bets perfectly. If the stock goes up, he sells it, pays off Mary, and still makes a profit. If it goes down, he reduces his loss by winning the bet he made with Mary.Our decision hedged in the children so they could not have any flexibility.to enclose someone or something in a hedge. (See alsohedgeTheir overgrown yard has almost hedged us in.to protect investments against a decline in value by making counterbalancing bets or investments.The investor hedged his portfolio against a drop in stock prices by buying some bonds.Lessen ones chance of loss by counterbalancing it with other bets, investments, or the like. For example,Im hedging my bets by putting some of my money in bonds in case theres another drop in the stock market, in the sense of a barrier, to a means of protection against loss. [Second half of 1600s], you are careful not to commit yourself to one thing, so that you do not make a mistake whichever way the situation develops.The Rev James Reeves is hedging his bets on whether Clark is the leader the Church needs in troubled times.Political forecasters are hedging their bets about the likely outcome of this Saturdays Louisiana governors race.Note: When bookmakers accept a large bet, they often try to protect themselves against heavy losses by laying bets with other bookmakers. This practice is called `hedging.try to minimize the risk of being wrong or incurring loss by pursuing two courses of action at the same time.your financial liabilities, especially bets or speculative investments, meant limiting your potential losses by also putting money on another outcome, in such a way as to balance, more or less, any potential loss on the initial transaction. In betting terms, this specifically means putting money on more than one runner in a race.All three methods have their proponents, and most anglers are wise to hedge their bets by using more than one method.) try to reduce the risk of losing your money, being wrong about something, etc. by choosing two or more courses of action at the same time:Shes invested her money in two quite different businesses, so shes hedging her bets.This idiom refers to putting money on more than one horse in a race to increase your chances of winning money.
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Hedge identification and timing rules – traps for the unwary
regulations also provide that taxpayers may elect out of the general rule requiring aggregation of members risks by making a separate entity election.
Effective date of proposed consolidated group hedging regulations
3) As the preamble correctly notes, however, these regulations are needed because related-party
is a common business practice and the existing regulations treat as
transactions only hedges entered into by a taxpayer to reduce its own risk.
Proposed hedging regulations under Sections 446 and 1221
About a third of the companies think the standard will change their use of derivatives and
Also, Congress clearly stated that it did not intend for the section 1256 rules to curtail the use of futures transactions for commercial
Assessing inherent risk and control risk for assertions about derivatives used in
activities, which may require an understanding of general risk management concepts and typical asset/liability management strategies.
Arkansas Best generated a significant level of uncertainty as to the treatment of gains and losses from
Ordinary treatment now available for hedging transactions
Companies use virtually all types of foreign-currency
instruments to hedge existing assets or liabilities, including forwards, swaps and other similar contracts.
The problem, Stoklosa continued, was that the derivatives available for
interest rate risk were based on a definition of interest rates that did not include the sector spread.
transaction is a transaction entered into to reduce the risk of price changes or currency fluctuations with respect to ordinary income property, or to reduce the risk of interest rate or price changes or currency fluctuations with respect to borrowings or ordinary obligations.
New hedging regulations designed to minimize character mismatch for tax purposes
If SFAS 52 applies, a company must demonstrate only that a contemplated transaction creates risk, while
transactions accounted for under SFAS 80 must meet a much more restrictive enterprise risk test.
STRATEGY CAN BE as simple as a long-term fixed-rate contract or as complicated as setting up a fully staffed trading desk.
Complex tax rules can also create tax reporting results that do not reflect the overall economics involved with
and hedge accounting need early consideration since
abounds and comprehensive guidance in the accounting literature is scarce.
The recently adopted Internal Revenue Service rules on
transactions certainly are welcome but, on examination, seem to do little more than capitulate to the decision on
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