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A forward contract is used for locking in the price of an asset, thus hedging against price volatility.

Similar to a forward, futures contracts mitigate risks of price fluctuations by setting a future price, but are standardized and traded on exchanges.

Options give the buyer the right, but not the obligation, to buy or sell an asset at a predetermined price, which can limit downside risk.

Swaps are used to exchange cash flows or financial instruments, allowing parties to manage interest rate risk or currency exposure.

A credit default swap is a financial derivative that enables an investor to 'swap' their credit risk with another party.

Interest rate derivatives are used to hedge against the risk of interest rate fluctuations that could affect the cost of borrowing or the value of investments.

Commodity derivatives are used by producers and consumers to hedge against the risk of commodity price changes that can affect their profits and costs.

Equity derivatives are used to manage risk associated with price movements in stock markets, allowing investors to hedge or speculate on equity prices.

FX derivatives are used to hedge against unfavorable currency exchange rate fluctuations that can impact international financial transactions.

Weather derivatives are used to hedge against financial risks associated with variations in weather, such as unexpected temperature changes affecting profits.

Inflation derivatives are used to mitigate the risk associated with inflation rates affecting the real value of assets and cash flows.

Binary options provide a fixed payoff depending on whether a certain condition is met at expiration, which can hedge against specific market moves.

Exotic options, with features more complex than standard options, are used for bespoke risk management strategies tailored to unique market views or circumstances.

Barrier options are utilized to manage risks by activating or deactivating based on the asset price reaching a certain level, providing cost-effective hedging.

A collar combines a cap and a floor to hedge against fluctuations in prices, often used to limit the range of possible outcomes in an investment.

By pooling assets into a tradable security, risk is spread among investors, mitigating individual exposure to defaults or other underlying asset risks.

Mortgage-backed securities spread the risk of mortgage defaults across many investors, hedging individual risk exposures to real estate markets.

Structured products can be custom-tailored to fit specific risk-return objectives, helping investors to achieve hedging alongside return enhancement.

Volatility derivatives allow investors to hedge against or speculate on future volatility levels of an underlying asset without directly exposing themselves to that asset.