Derivatives & Risk

What is hedging and how do you hedge a crypto portfolio?

Hedging is taking an offsetting position to reduce the impact of an adverse price move on an existing holding. Crypto investors commonly hedge by buying put options, holding stablecoins, shorting futures, or diversifying across assets that do not move together. For example, a put on Bitcoin can limit downside on a long position while leaving some upside intact. Hedging reduces exposure at a cost and does not remove risk entirely. Thinking about correlation and downside protection is part of structured portfolio construction, which is how Qatobit's documented, diversified index methodology approaches allocation. Read the methodology to see it applied.

Crypto investments are subject to market risk and volatility. Past performance is not indicative of future returns. This is general information, not investment advice — consider your own circumstances or consult a qualified adviser before investing.