a

transaction

in which a product is short, a product is

long

and the position is closed at the same time at a certain point in the future is a hedging transaction. Usually used for

futures

hedging.

if your hedging transaction can get a

price difference

when you close the position, this part of the

profit

is arbitrage.

For example, to make an extra

fund

with the

Shanghai and Shenzhen 3 Index

as the

target, and short

stock index futures

at the same time, this is hedging. If the fund is discounted when you buy it, you will close your position when the discount is eliminated, and the discounted part will be obtained by arbitrage.