Hedging refers to related production enterprises. In order to prevent the production risks caused by the rising or falling prices of raw materials, they choose to sell short or do long in the futures market to avoid risks. For example, the farmer planted a lot of corn, but he was afraid that the price of corn would fall next year, so he chose to short corn in the futures market to prevent the risk of falling prices.

The main function of spot listing through the futures market is to let enterprises hedge their production risks through the futures market, and the participation of other institutions and speculators can improve the liquidity of the market.

Tips: The above contents are for reference only.

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