I think like that but http://risklearn.com/strip-and-stack-hedge/
they compare between profit from " cash flow from delivery " and " strip hedge" or " stack hedge"
I can't understand :(
Hi everybody,
I have some questions about hedging
I promise to sell 1ooo barrels at $120 next year. So my hedge is long forward at $118
If the spot today and next year are both 115, what is the hedge 's profit/loss?
I think the profit is $118 - $115
But I am confused about the cash inflow $ 120...
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