What is Hedging?

Legal Definition
A means by which collectors and exporters of grain or other products, and manufacturers who make contracts in advance for the sale of their goods, secure themselves against the fluctuations of the market by counter contracts. 198 U. S. 236, 49 L. Ed. 1031, 25 Sup. Ct. Rep. 637.
-- Ballentine's Law Dictionary
Legal Definition
Limited or offsetting the loss from changes in price. It transfers risk without buying insurance.