The Traditional Hedging Method in Times of Crisis and the New Tool: Cryptocurrency
Authors
Quanhao He1, *
1Department of International Business School, Hunan University of Technology and Business, Changsha, 410000, China
*Corresponding author. Email: qhe01@frostburg.edu
Corresponding Author
Quanhao He
Available Online 26 March 2022.
- DOI
- 10.2991/aebmr.k.220307.161How to use a DOI?
- Keywords
- Crisis; Hedge; Time-series-momentum; Long Puts; Cryptocurrency
- Abstract
This paper gives a clear definition of the crisis and summarizes the hedging methods used to apply risk in times of crisis. The results show that active hedging strategies are more effective than passive hedging strategies when the economy is at its worst. Then, it proposes a new type of hedging method that may be used in the future – cryptocurrency, illustrating its model, operation principle, hedging effect, and feasibility. The results show that cryptocurrencies such as Bitcoin have a significant impact on hedging against the dollar in the short term and can be used to supplement traditional hedging methods such as gold and momentum.
- Copyright
- © 2022 The Authors. Published by Atlantis Press International B.V.
- Open Access
- This is an open access article under the CC BY-NC license.
Cite this article
TY - CONF AU - Quanhao He PY - 2022 DA - 2022/03/26 TI - The Traditional Hedging Method in Times of Crisis and the New Tool: Cryptocurrency BT - Proceedings of the 2022 7th International Conference on Financial Innovation and Economic Development (ICFIED 2022) PB - Atlantis Press SP - 976 EP - 982 SN - 2352-5428 UR - https://doi.org/10.2991/aebmr.k.220307.161 DO - 10.2991/aebmr.k.220307.161 ID - He2022 ER -