Proceedings of the International Workshop on Navigating the Digital Business Frontier for Sustainable Financial Innovation (ICDEBA 2024)

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Hedging with Different Financial Risks by Constructing Investment Portfolios

Authors
Jiansheng Li1, *
1Changchun New Oriental School, Changchun, Jilin Province, 130012, P.R. China
*Corresponding author. Email: jianshengli@ldy.edu.rs
Corresponding Author
Jiansheng Li
Available Online 24 February 2025.
DOI
10.2991/978-94-6463-652-9_48How to use a DOI?
Keywords
Hedging Risk; Investment Portfolio; Data Analysis
Abstract

Risks play an important role in investor’s decisions. So far, scholars have developed many strategies that can mitigate financial risks in theory, but for risks in real life, their changes are influenced by many complex factors. Therefore, constructing a valid investment portfolio in real life is still challenging. This article will construct various investment portfolios to hedge different financial risks. The research methods used in this paper are as follows. First, find some real investment opportunities and figure out their risks. Then, collect real-life data about different financial products that can be used to construct portfolios. Finally, identify portfolios that can mitigate risks. It was found that interest rate futures contracts, gold, and investments in different national markets can effectively mitigate interest rates, purchasing power, and exchange risks, respectively. The actual cases prove that individual investors can mitigate the financial risks of investment by constructing investment portfolios. The study found that investors can choose to invest in socially and economically stable areas, which can avoid many risks without the need to hedge their portfolios.

Copyright
© 2025 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title
Proceedings of the International Workshop on Navigating the Digital Business Frontier for Sustainable Financial Innovation (ICDEBA 2024)
Series
Advances in Economics, Business and Management Research
Publication Date
24 February 2025
ISBN
978-94-6463-652-9
ISSN
2352-5428
DOI
10.2991/978-94-6463-652-9_48How to use a DOI?
Copyright
© 2025 The Author(s)
Open Access
Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

risenwbib
TY  - CONF
AU  - Jiansheng Li
PY  - 2025
DA  - 2025/02/24
TI  - Hedging with Different Financial Risks by Constructing Investment Portfolios
BT  - Proceedings of the International Workshop on Navigating the Digital Business Frontier for Sustainable Financial Innovation (ICDEBA 2024)
PB  - Atlantis Press
SP  - 452
EP  - 461
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-652-9_48
DO  - 10.2991/978-94-6463-652-9_48
ID  - Li2025
ER  -