Stretching is part of every exercise routine, and should also be part of a healthy guitar routine. Warming up the muscles in your hands and arms before a practice session or a gig keeps them from tightening and cramping up. It also helps prevent Repetitive Stress Injuries (RSIs).
I’ve tried various things over the years, but I’ve found this stretch routine illustrated by Mark Wein to be very effective. It’s quick, easy, and can be performed anywhere:
If I’m in for a particularly long rehearsal or concert, I might also start out by soaking my hands and forearms in hot water for a few minutes. That’s not always an option, but soaking is a great way to loosen up those forearm muscles for a long session. Likewise, if available, a good soak in cold water after playing is a nice way to cool down (ice paks or ice water are very soothing for sore hands/arms after a long gig or series of gigs).