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Stop Loss or Hedge It?

  • #41
  • Edited 10:42pm Jul 12, 2018 10:28pm | Edited 10:42pm
If the SL is well within your calculated risk/money management, just let the market run its course OR reduce you lot size to half or 70% before hit SL,just to minimize the damage but avoid missing the trade if the condition turn to winning trade..what i normally do.

When you saw your position approaching your SL level, then immediately hedge it,t clearly showed that your decision to trade is based on emotion.No clear setup based on your own strategy but still want to open a position (hedging)....

Let it go, let it go, Can't hold it back anymore...

F.I.T
Close Trade At Profit
  • #42
  • Jul 12, 2018 10:46pm Jul 12, 2018 10:46pm
Quoting josephcom
{quote} The problem is that sometimes (actually many times!) the market comes down, triggers you SL, and then goes up again
Yes sir I believe I discussed this issue already here;. https://www.forexfactory.com/showthr...4#post11256824
@xxxx§|[::::::::::::::::>
  • #43
  • Jul 12, 2018 11:16pm Jul 12, 2018 11:16pm
1 position you have 1 problem,with hedge now you have 2 problems,with a note that you try to turn both into profit.and not every body good at multi tasking.
Don't mind me.. i'm crazy
  • #44
  • Jul 13, 2018 5:02am Jul 13, 2018 5:02am
is it so difficult to understand that hedging is same like closing a position, only the most complicated way, with still a risk open and you pay rollover for this (when you hold it).
its so simple math, anyone who tell hedging is better then using closing a position should begin to paint an example on paper or here in the thread to understand why he is wrong. there is not "both can be correct" way, one way is superior to the other way... really, without the parts i mentioned already.

hedging is one of the best ways for brokers to earn good additionally money from beginner traders, no advanced trader would ever use it, never (only some who think they are advanced but they are not). no advanced trader would spend useless money for nothing, noone would use a more expensive broker against a cheaper broker, when both are same in rest.

there are difficult parts in trading and calculation, where its realy difficult to use math, but hedging is really one of the most basics and easy parts.
  • #45
  • Jul 13, 2018 5:41am Jul 13, 2018 5:41am
"You got a position opened and the market is about to hit your SL (Stop Loss) value.
What do you do?"

Nothing. Waiting for the other trade opportunity.
  • #46
  • Jul 13, 2018 5:54am Jul 13, 2018 5:54am
Quoting purplezero
"You got a position opened and the market is about to hit your SL (Stop Loss) value. What do you do?" Nothing. Waiting for the other trade opportunity.
This is too simple & sensible so it must be wrong
who dares wins
  • #47
  • Jul 13, 2018 5:59am Jul 13, 2018 5:59am
it's working for me :-)
  • #48
  • Jul 13, 2018 6:08am Jul 13, 2018 6:08am
Quoting dukas_trader
is it so difficult to understand that hedging is same like closing a position, only the most complicated way, with still a risk open and you pay rollover for this (when you hold it). its so simple math, anyone who tell hedging is better then using closing a position should begin to paint an example on paper or here in the thread to understand why he is wrong. there is not "both can be correct" way, one way is superior to the other way... really, without the parts i mentioned already. hedging is one of the best ways for brokers to earn good additionally...
Excellent post sir. I too see 0 benefit from hedging at all. It simply increases the broker's profits for the simple fact that you are offsetting your open order with the same instrument or another. Those who hedge are in the same bracket as those who use multiple lot sizes at different increments in order to manipulate their total pip count. Say the max lot i want to use is 5.00 lots. I believe the run will go up 100 pips. Now if i break those 5.00 lots into .1 orders then i have 50 additional orders compared to if i had only opened one. Let us see the tp hits and you as a follower would be impressed with the 100 pips that 1order of 5.00 lots made or those 5000lots from those 50 .1 orders?
Read my shouts to get myfxbook link
  • #49
  • Jul 13, 2018 6:09am Jul 13, 2018 6:09am
Quoting dukas_trader
is it so difficult to understand that hedging is same like closing a position, only the most complicated way, with still a risk open and you pay rollover for this (when you hold it). its so simple math, anyone who tell hedging is better then using closing a position should begin to paint an example on paper or here in the thread to understand why he is wrong. there is not "both can be correct" way, one way is superior to the other way... really, without the parts i mentioned already. hedging is one of the best ways for brokers to earn good additionally...
In all my years of trading I've only ever seen one genuine way of benefiting from hedging a losing position, and it was only when it was used under a very specific situation within a very complex trading system. In 99.99% of cases though, mathematically you'd be better off just closing the position instead of hedging.
  • #50
  • Jul 13, 2018 7:04am Jul 13, 2018 7:04am
Quoting loleno
{quote} In all my years of trading I've only ever seen one genuine way of benefiting from hedging a losing position, and it was only when it was used under a very specific situation within a very complex trading system. In 99.99% of cases though, mathematically you'd be better off just closing the position instead of hedging.
believe me, there is 100%! the situation you did see is also wrong, and could be better with simple closing an reopen and not hedging. its impossible by math that you can be better with hedging against closing and reopen.

often beginner dont want losses, and thatswhy hedge and think they have only loss when a position is closed (one often to see beginner mistakes or used by many scammers), not before. thats stupid. any advanced trader recalculates any trade at any time he looks in his his account, from this time the win he see is booked , finished and the position is from this time reopened in his mind in this second, if he would not have this postion still open he would simple close it....... but this are the mosre advanced parts poeple looks like at trading, i dont know if beginenrs can really understand what i say with this part, and its ok when they dont understand in the beginning,. the most important part to learn ist, hedging is no good way.
  • #51
  • Jul 13, 2018 8:07am Jul 13, 2018 8:07am
Quoting dukas_trader
{quote} believe me, there is 100%! the situation you did see is also wrong, and could be better with simple closing an reopen and not hedging. its impossible by math that you can be better with hedging against closing and reopen. often beginner dont want losses, and thatswhy hedge and think they have only loss when a position is closed (one often to see beginner mistakes or used by many scammers), not before. thats stupid. any advanced trader recalculates any trade at any time he looks in his his account, from this time the win he see is booked...
Like I said, there is a certain benefit to be gained under a very specific scenario. It’s already been discussed by some intelligent traders here at FF. It is not related to costs/psychology. Thinking outside the box is a skill. It’s good to keep an open mind
  • #52
  • Jul 13, 2018 9:21am Jul 13, 2018 9:21am
There is often confusion among the forex traders that whether it is safe to use hedge or stop loss. It is basically dependent on the trading method or style of a forex trader. But from my point of view, hedging is one of the aggressive risk management tools. A forex trader can use hedging when he is not at all sure about the market conditions otherwise stop loss is a better option.
  • #53
  • Jul 13, 2018 9:22am Jul 13, 2018 9:22am
Quoting loleno
{quote} Like I said, there is a certain benefit to be gained under a very specific scenario. It’s already been discussed by some intelligent traders here at FF. It is not related to costs/psychology. Thinking outside the box is a skill. It’s good to keep an open mind
sorry thats impossible. there is no certain benefit gained under very specific scenario. thats really impossible by 100% math! you are really wrong in this and get faked. of course you can get same like with closing and reopen trade, but benefit, no! impossible by math, impossible in 100% of all cases! (without the reasons i mentioned!)

describe in an example what you think is this benefit, and i will show you why you are wrong. this people who tell this benefit exists are always beginners or fakers (always!).
  • #54
  • Jul 13, 2018 9:24am Jul 13, 2018 9:24am
Quoting SandroFlora
There is often confusion among the forex traders that whether it is safe to use hedge or stop loss. It is basically dependent on the trading method or style of a forex trader. But from my point of view, hedging is one of the aggressive risk management tools. A forex trader can use hedging when he is not at all sure about the market conditions otherwise stop loss is a better option.
Sl is same like hedging, only hedging is more beginner style and more expensive way , the broker like more.
  • #55
  • Edited 12:40pm Jul 13, 2018 12:17pm | Edited 12:40pm
Quoting dukas_trader
{quote} sorry thats impossible. there is no certain benefit gained under very specific scenario. thats really impossible by 100% math! you are really wrong in this and get faked. of course you can get same like with closing and reopen trade, but benefit, no! impossible by math, impossible in 100% of all cases! (without the reasons i mentioned!) describe in an example what you think is this benefit, and i will show you why you are wrong. this people who tell this benefit exists are always beginners or fakers (always!).
Actually. It is very possible.. The situation which hedging would lead to an automatic win is during Sunday market open, assuming that from Friday's close to Sunday's open the mzarket will gap.
Conditions we need?
1) either Two accounts at the same brokee or two different brokers
2) You need the spread to remain intact so you dont margin call right before the market closes
3) a simple market gap of anything more than 10 pips would give you an edge that is unbeatable.


Directions

Say you expect EU to gap because of some pr which will occur during the market is close. Being as we domt know where the direction will go after the news then that is why you hedge to give yourself an edge. So right before close here is what you do:

1) Open a buy in one account and a sell in another account. (Hedging in this case would be done from two seperate account and never from one which is normal)

2) try to place both of the orders at the sametime right before mzrket closes because if only one is able to open then you would be exposed as most swing traders are durimg these types of news.

If you are able to place the buy and sell for 100% margin with 1000:1 then every 10 pips which the market gaps is 100% profit in the account that is in the right direction of the gap. The other account which will margin call the moment the market opens but being as you have the other account at a seperate broker you would be laughing to the bank as that 50 point gap turned your overall profit into 400%.
Read my shouts to get myfxbook link
  • #56
  • Jul 13, 2018 1:01pm Jul 13, 2018 1:01pm
Quoting IggyMon
{quote} Actually. It is very possible.. The situation which hedging would lead to an automatic win is during Sunday market open, assuming that from Friday's close to Sunday's open the mzarket will gap. Conditions we need? 1) either Two accounts at the same brokee or two different brokers 2) You need the spread to remain intact so you dont margin call right before the market closes 3) a simple market gap of anything more than 10 pips would give you an edge that is unbeatable. Directions Say you expect EU to gap because of some pr which will occur...
wait, i did not say that "idiotic" plans !

you have many problems in your plan!
- no good broker will allow you a trade before weekend, that 10 pips are 100% win, this would be only possible with marketmaker broker and with very very small accounts
- when you open with such a bad marketmaker broker the chances that the spreads are this 10 pips in the last seconds before weekend already and both accounts are margin called are very high
- when you open with such a bad marketmaker broker the chances that the spreads are very high for the first seconds after the weekend and both accounts are margin called

even when you win, do this one time and the broker will not allow it any more. this is a good theory example to cheat a broker, but broker are not stupid and know this facts already and know what to do against.
  • #57
  • Jul 13, 2018 1:14pm Jul 13, 2018 1:14pm
Quoting dukas_trader
{quote} wait, i did not say that "idiotic" plans ! you have many problems in your plan! - no good broker will allow you a trade before weekend, that 10 pips are 100% win, this would be only possible with marketmaker broker and with very very small accounts - when you open with such a bad marketmaker broker the chances that the spreads are this 10 pips in the last seconds before weekend already and both accounts are margin called are very high - when you open with such a bad marketmaker broker the chances that the spreads are very high for the first...
dukas, my explaination came with IFS just s your comment but the reality is you have well over 10 brokers who dont widen the spread prior to market close. Also note, the b-book brokers are the bestones to do this to becausw they typically have tight spreads and trade against their clients. Infact, the method i have mentioned befor e has been documented towork and it is actually on one persons youtube channel. If you search hard enoughyousill find it and see the proof of him making money using thr method.
Read my shouts to get myfxbook link
  • #58
  • Jul 13, 2018 1:16pm Jul 13, 2018 1:16pm
Quoting IggyMon
{quote} dukas, my explaination came with IFS just s your comment but the reality is you have well over 10 brokers who dont widen the spread prior to market close. Also note, the b-book brokers are the bestones to do this to becausw they typically have tight spreads and trade against their clients. Infact, the method i have mentioned befor e has been documented towork and it is actually on one persons youtube channel. If you search hard enoughyousill find it and see the proof of him making money using thr method.
with mini mini money and the broker kicks him out after some time? no broker (such brokers you mentioned, what i never have seen, but i dont use marketmaker broker) will look at such long, because the broker lose then always over time, they are not stupid and no broker can allow his clients to win for sure!!

show me someone trades big money (or at least medium money), have such leverage and is not kicked out by brokers very fast! and no fake showing of course, so only bigger real accounts, that demo account will work is for sure, many cheater strategies work with demo accounts always.
  • #59
  • Jul 13, 2018 1:49pm Jul 13, 2018 1:49pm
Quoting dukas_trader
is it so difficult to understand that hedging is same like closing a position, only the most complicated way, with still a risk open and you pay rollover for this (when you hold it). its so simple math, anyone who tell hedging is better then using closing a position should begin to paint an example on paper or here in the thread to understand why he is wrong. there is not "both can be correct" way, one way is superior to the other way... really, without the parts i mentioned already. hedging is one of the best ways for brokers to earn good additionally...

"pearls before swine." But good you are trying to help them.
  • #60
  • Jul 13, 2018 2:48pm Jul 13, 2018 2:48pm
Quoting Guufuj
You got a position opened and the market is about to hit your SL (Stop Loss) value. What do you do? Quickly remove the SL value or Hedge it or you just let it go and then smile ?
IMO you are not dislcosing much here. Just that you are having a problem with this DD and just about every persons advice here can be applied BUT it all depends on your overall situation. Mindset. Conviction. Account size. Experience . Floating p/l etc..... all important factors
Anyway. Happy trading...
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