Interest rate futures hedging?

i still did not understand the IRF hedge strategy .

i am regular currency trader , but have never under taken hedging for anything till now .

1) i understand that we short the expensive month and buy cheaper month . but then how exactly do we square-off for a profit ?

as per z-connect article :-  Margin requirement for Calendar Spread: Rs 800 per contract (Where you buy and sell different expiry of the same contract, lesser because it is completely hedged).

2) when you say "COMPLETELY HEDGED" does it mean there is no scope of loss making ( besides taxes & brokerage ) ?

If you buy one month and sell another, it is called a calendar spread.

Trading calendar spreads make sense when you think the spread (this month-next month) will either go up or down. If you think it is going to go up, you buy the spread otherwise short it.

So in a sense it is a naked trading strategy, and not really a hedge. Even though the positions are completely hedged, if the spread goes against you, there would be losses made.

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Hey Nithin, do you think you can come up with “spread” chart in kite?