Hedger

A person or a company owning or planning to hold a cash commodity wheat, corn, soybeans, U.S. Treasury bills, bonds, notes, etc. and concerned that the cost of the commodity may change before buying or selling it in the cash market. A hedger seeks protection against changing cash prices by entering a futures position of the same or similar commodity and later closing that position by selling the futures contracts of the same quantity and type as the initial transaction. Hedgers trade in futures markets to protect their portfolio from adverse price changes.