Yes but that’s not really how people hedge. It’s more: through various operation you end up with a large undesired $1M bet on head as a byproduct. To counter y

Yes but that’s not really how people hedge. It’s more: through various operation you end up with a large undesired $1M bet on head as a byproduct. To counter your exposure you put another $1M bet on tail. Now whatever happens, it shouldn’t impact you. Of course managing the two bets have a cost but that’s one you are ready to pay to escape being affected by the coin flip. Hedge significantly reduces the exposure of companies to events they don’t want to be exposed to. Of course it could blow but that’s still better than having companies carrying random risks they don’t want.