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.
The ratio of the change in price of an option to the change in price of the underlying asset. Also called the hedge ratio. Applies to derivative products. For a call option on a stock, a delta of 0.50 means that for every $1.00 that the stock goes up, the option price rises by $0.50.elta. The change in the price of an option that results from a one-point change in the price of the underlying stock. For example, a delta of 0.5 indicates that the option will rise in price by 1 / 2 point (50Â¢) for each 1-point ($1) rise in the price of the underlying stock.