Leading And A Lagging Indicator:Technical traders use indicators to identify market patterns and trends. Most of these indicators fall into two categories: leading and lagging. A leading indicator is a tool designed to anticipate the future direction of a market, in order to enable traders to predict market movements ahead of time. It measures preceding or indicating a future event used to drive and measure activities carried out to prevent and control injury. Lagging indicators measure a companys incidents in the form of past accident statistics. It is the traditional safety metrics used to indicate progress toward compliance with safety rules. Since, Leading and Lagging indicators focuses on future safety performance and continuous improvement, it can be used as a hedging technique. Therefore, Leading and lagging are used for hedging. The speculation involves trying to make a profit from a security's price change, whereas hedging attempts to reduce the amount of risk, or volatility, associated with a security's price change. Hedging involves taking an offsetting position in a derivative in order to balance any gains and losses to the underlying asset.