Hedging refers to the trading activities in which the futures market is used as a place to transfer the price risk, and the futures contract is used as a temporary substitute for buying and selling commodities in the spot market in the future, so as to insure the prices of commodities to be bought in the future.

You have a batch of goods to sell in the future, but you are worried that the spot market price will fall, so you are shorting (selling) the corresponding goods in the futures market now. When you want to sell a commodity, if the market price really falls (generally speaking, the futures price of the corresponding commodity will also fall), you must close the short position (that is, buy) established in the futures market. At this time, the money you earn less in the spot market is compensated in the futures market (because you sell high and buy low in the futures market). If it goes up, you will lose money in the futures market, but the extra money you earn in the spot market can be used to make up for the money you earn in the futures market.

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Hedging is not used to make money, but to prevent risks, and because of the change of basis, there is no absolute guarantee of complete hedging.

In the stock market, if you hold spot bulls, that is, stocks, you can short stock index futures accordingly, thus achieving the purpose of hedging. The price of hedging is a process of locking in costs. Your single position may be profitable, but your contribution is exposed.

So the hedging price is only used to lock in the cost. If it is pure hedging, you should not wait for the price to change, but should hedge from time to time.