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Big Tech is hiding $1.65tn in off-balance-sheet AI debt (thenextweb.com)
submitted 3 months ago by to c/technology@lemmy.world
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[–] 2 points 3 months ago (1 child)

well if you're rich and you lose a bundle it wont be a big of a deal, that's why.

hedges are risky, and it's much easier to take risks if you have a large cushion to fall on when you fall.

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  • [–] 1 point 3 months ago* (last edited 3 months ago)

    Those are reasons why loses aren't as big of a concern for rich people. Not why hedges are only for rich people.

    The cost of a hedge is proportional to the assets being protected. If someone has say a $10,000 portfolio of stocks, and they think the market will crash in the next month or two, they could buy a protective option hedge for around $100. And if someone has a portfolio of $300 million, they could hedge for ~$3 million. Wealth is irrelevant.

    Also hedges aren't risky. They reduce risk. They're insurance.

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