The risk of Hedging against risks -- a life application

CT7 Excerpt M05Q3
What are the limitations of a hedging strategy by using stock index futures to hedge against adverse share price movements?

Ans: The share price of the target company might not move in line with the market index.
As is often the case in the commercial world, the exact cash movements are seldom known in advance. The key is to hedge the best estimate of the known risk.

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Reading this, I could not help but agree. It is very true -- in every aspect of life (not just share prices!), we can only do the best we can to minimise the known risk, and trust that God will dictate our paths out of His commitment to us.

Got many aims in life, but do they really glorify His Name? Which of these paths will lead to the least risk and greatest guarantee of the investments we have put under His Name?


When potential energy remains as potential energy -- that is, instead of translating to kinetic energy -- when this happens, I jump ship and remove myself from that situation, Lord.