Because the risk of the option buyer is limited, after paying the premium, even if the target price moves in an unfavorable direction, there is no need to pay the margin, so there is no problem of additional margin. However, in the process of hedging the spot with futures, if future positions loses money, it will face the risk of additional trading margin. If the hedger can't make up the margin in time because of the shortage of funds or excessive losses, it will also lead to the forced liquidation of future positions, which will lead to the failure of the whole hedging plan.

By buying options to hedge, the maximum loss is limited and clear, which can effectively avoid this problem. It can be seen that option hedging can better meet the hedging needs of hedgers.

2. The hedging effect of options is more certain.

In futures hedging, the hedger avoids the greater risk of price fluctuation and adopts the smaller basis risk. The change of basis is very important to the hedging effect, and the existence of basis risk makes the effectiveness of hedging in futures market uncertain. There is no such problem when using option hedging.

First of all, the setting of option exercise price fixes the delivery price of the underlying assets on the maturity date; At the same time, the buyer of the option has the right and no responsibility, and the risk is foreseeable. The biggest loss is the royalties paid for options. Investors can determine the highest buying price in the future by buying call options, and can also determine the lowest selling price in the future by buying put options. Therefore, option is a more effective risk management tool for risk-averse hedgers.

3. Option hedging strategies are more diverse and flexible.

In the futures hedging strategy, in order to avoid the risk of rising prices, investors can only choose to buy the corresponding futures contracts; In order to avoid the risk of falling prices, investors can only choose to sell the corresponding futures contracts.