basis risk
C1CEFR level
85/100Rarity: very rare
TechnicalRegister
The risk that a hedge and the exposure it is meant to cover move imperfectly together.
Hedging jet fuel with crude futures left the airline exposed to basis risk when the crack spread blew out.
Rarity runs from 0 (a word everyone knows) to 100 (almost never seen outside specialist or literary writing). Level is the word's real difficulty on the CEFR scale, from A1 to C2.
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