Caricature of a tramp. A vagrant or a vagabond is a person, often in poverty, who wanders from place to place without a home or regular employment or income. Other synonyms include tramp, hobo, and drifter.
Hedge Ratio. 1. A ratio of the value of the proportion of a position that is hedged to the value of the entire position. A hedge ratio shows how exposed an investment is to risk. For example, if a hedge ratio is .65, then 65% of the investment is protected from risk, while 35% remains exposed. 2. A ratio of the value of a futures contract to the value of the underlying asset. This is used to identify and minimize risk in the contract.
What is a 'Hedge'. A hedge is an investment to reduce the risk of adverse price movements in an asset. Normally, a hedge consists of taking an offsetting position in a related security, such as a futures contract. Hedging is analogous to taking out an insurance policy.