Dynamic hedging is an active risk management technique in which investors frequently rebalance their hedge positions in response to changes in market prices, volatility, or other market variables. Commonly used with derivatives such as options, this strategy aims to maintain an effective level of protection rather than relying on a one-time hedge. As market conditions shift, the hedge ratio is adjusted continuously to minimize potential losses and manage exposure efficiently.

Agency cost refers to the conflict and expenses that arise when managers, who act as agents of the company, pursue personal objectives rather than maximizing shareholder wealth. Since ownership and control are separated in modern corporations, managers may make decisions that benefit themselves through higher perks, lower effort, or risk-averse strategies, which may not align with the interests of shareholders. To reduce such conflicts, companies implement monitoring mechanis

Secular stagnation is when an economy slows into a long freeze, with weak demand, low growth, and little momentum to move forward.