Hedge funding in NBA terms is basically making a bet on which team or which player will fail to meet their expectations. If you were to hedge fund on a player, who would it be?
I would mortgage my house to hedge fund on James Wiseman because I do not envision him as a good basketball player at all. The gains would be small because it’s obvious but it’s a quick and guaranteed positive investment.
Hedging is a risk management strategy employed to offset losses in investments by taking an opposite position in a related asset. The reduction in risk provided by hedging also typically results in a reduction in potential profits. Hedging requires one to pay money for the protection it provides, known as the premium.
(From google)
And what he’s describing is just taking the under on teams