The principle of hedging: the disadvantage of holding a position or averaging down to increase margin is that it does not acknowledge past erroneous decisions, allowing wrong decisions to continue compounding errors, with the new future determined by a series of past decisions. The mistake and principle of holding a position lies in continually making wrong decisions, leading to an erroneous future. The principle of hedging is to stop making wrong decisions and to influence the future with new correct decisions, thereby creating a new correct future. Holding a position uses margin and past erroneous decisions to influence the future, while hedging uses new decisions to influence the future.