Hedge wrapper


An options strategy in which an investor with a long position in an underlying stock buys an out-of-the-money put and sells an out-of-the-money call. The hedge wrapper defines a range where the stock will be sold at expiration of the option, whichever way the stock moves.

Investing Essentials

Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Fast market

Excessively rapid trading in a specific security that causes a delay in the electronic updating of its last sale and market conditions, particularly in options.

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