Head and Shoulders
A chart pattern indicating a peak, a decline, a second even higher peak, a decline, a rebound to the level of the first peak, and yet another decline. A head and shoulders pattern is supposed to be bad news, indicating the stock is headed downward.
Hedge Ratio (for an option)
Ratio between the change in an option’s theoretical value and the change in price of the underlying stock at a given point in time. Also called delta.
Taking a position in a futures market opposite to a position held in the cash market to minimize the risk of financial loss from an adverse price change.
Hedging Demands
Demands for securities to hedge particular sources of consumption risk, beyond the usual mean-variance diversification motivation.
Horizon Analysis
Interest rate prediction that uses a forecast yield curve to predict bond prices.