Evaluation of the effectiveness of methods of the imperfect hedging of financial options on the Russian forward market

Abstract

Under unstable economic conditions, interest in the financial derivatives market is easy to understand. On the Russian forward market, derivatives such as options and futures are gaining increasing popularity as a means of managing the risks of business units in order to protect against possible financial losses. The competition created among the organizers of forward trading has encouraged the emergence of a technically effective trading method and an expanded range of available financial instruments. The need for an expanded range of risk-management instruments and the introduction onto the market of cutting-edge methods relying on a strict formalization of investor decisions has determined the current relevance of the article at hand. The aim of the article involves studying the latest methods of hedging financial options, comparing and contrasting the new methods with those traditionally used in the financial industry, and analyzing the opportunities for applying methods of imperfect hedging on the Russian forward market.