Given this, one would not want to have such a hedging position in place continuously but would want to have it in place when an event occurs.

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But what about (a firm) like a Goldman Sachs which is hedging a futures position in commodities versus hedging a futures position in currencies?

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For a deal involving several complex steps, his all-in price would reflect the cost of hedging his own position.

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Since first disclosing the loss, Dimon has largely pinned the blame on a hedging strategy gone wrong, a synthetic credit portfolio initially intended to protect the company that became a successful position and blinded those who were in charge of managing it to the rising threat it posed.

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When this hedging can't be accomplished perfectly, as in the case of some individual Chinese bank, Goldman offsets its position with an index of several Chinese banks.

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