Proceedings of the 2022 7th International Conference on Financial Innovation and Economic Development (ICFIED 2022)

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.

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Volume Title
Proceedings of the 2022 7th International Conference on Financial Innovation and Economic Development (ICFIED 2022)
Series
Advances in Economics, Business and Management Research
Publication Date
26 March 2022
ISBN
10.2991/aebmr.k.220307.161
ISSN
2352-5428
DOI
10.2991/aebmr.k.220307.161How to use a DOI?
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  -