> ## Documentation Index
> Fetch the complete documentation index at: https://docs.activeviam.com/llms.txt
> Use this file to discover all available pages before exploring further.

# HMA

<table><tr><th>Description</th><td>A hedging misalignment parameter, which is designed to limit the extent to which indirect hedges can reduce capital requirements given that they will not fully offset movements in a counterparty’s credit spread.</td></tr><tr><th>Reference</th><td><a href="https://www.bis.org/basel_framework/chapter/MAR/50.htm?inforce=20230101&published=20200708#paragraph_MAR_50_20230101_50_25">\[MAR50.25]</a></td></tr><tr><th>Notation</th><td>$\sum_{c} HMA$</td></tr><tr><th>Formula</th><td>$\sum_{c} HMA=\sum_{c} \sum_{h \in c} \left(1- r_{hc}^2 \right) \cdot \left( RW_{h} \cdot M_h \cdot B_{h} \cdot DF_h \right)^2$</td></tr></table>

## See also

* [Correlation r\_hc](./correlation-r_hc)
* [Discount Factor Hedge](./discount-factor-hedge)
* [Hedge Notional](./hedge-notional)
* [Hedge Remaining Maturity](./hedge-remaining-maturity)