Option hedging can hedge the risk of fluctuation. Option buyers have the characteristics of long fluctuation, and sellers have the characteristics of short fluctuation. If the volatility of the underlying assets increases during the hedging period, the buyer can obtain additional income through the increase of volatility. Therefore, using option hedging can not only realize price hedging, but also realize fluctuation hedging, and the hedging effect is more comprehensive, which futures hedging does not have.

Option hedging refers to buying or selling option contracts that are the same as or related to spot commodities, with opposite directions, the same quantity or equivalent, and the same or similar month in the option market, so as to establish a profit-loss offset mechanism between the option market and the spot market to avoid the risk of price fluctuation.