Effective risk management is essential to preserve the stability and resilience of financial markets, institutions, and individual portfolios, as unmanaged exposures can lead to significant losses or systemic disruptions due to various types of risks. One prominent method to mitigate these risks is hedging with derivatives, as discussed in Chapter 5 . This involves the systematic deployment of instruments such as options, futures, forwards, and swaps to compensate for adverse fluctuations in underlying asset prices, thus cushioning the negative impact. For example, Chapter 5 introduced the use of futures contracts to lock in future transaction prices and protective puts to protect against sudden declines in asset prices.