I believe that people who have just entered the stock market always have such doubts about stocks, and many stocks are unclear. For example, recently, friends don't know the difference between buying hedging and bull market hedging. The following is Bian Xiao's introduction.

Buying hedging: If the hedger expects the spread of futures contracts to widen, the hedger will buy the foot with high price and sell the foot with low price at the same time.

Bull market hedging: in the case of insufficient market supply and strong demand, the increase rate is greater than the contract price in recent months, or the decrease rate is less than the contract price in recent months (forward market and reverse market). When buying a near-month contract, you will sell a far-month contract hedge.

Bull market hedging is expected to raise the price in the future, but generally speaking, the contract changes in recent months are greater than those in the distant months. Bull market hedging refers to the hedging of buying near and selling far. Buy hedging refers to the month when the buying price is high and the selling price is low. Therefore, when hedging in a bull market, the contract price in the recent month is higher than that in the far month, which is actually buying hedging.

For bull market hedging traders, as long as the two-month spread narrows, traders can realize their own gains, which has nothing to do with the rise of futures prices. The price difference hedging operation of bull market hedging is essentially a speculative behavior of price difference change in futures market. Taking advantage of the price distortion of futures contracts in the market, it is predicted that this price distortion will eventually disappear and obtain hedging income.