Have to agree, totally pointless.
Hedging 34 replies
Pivot point reference point? 7 replies
Hedging strategies 7 replies
DislikedHedging the same pair works if you are holding a long term trade and you want to play a correction in a smaller timeframe. can be a great tool if used correctly.Ignored
DislikedHedging is very dangerous !Ignored
DislikedIs there an EA to Hedge a single pair/ instrument.......Ignored
Dislikedhedging has many pros and cons depending on its use. a very very nice use is instead of stop loss. you open a hedge position instead of closing a position. then you wait for the market to calm down, you get the profit from the one positions (if there is any) and wait for a good moment to close the other position with smaller losses or even profit. this off course works on normal market conditions and needs some experience as well. and patience. but it is a nice tactic for forex trading.Ignored
Dislikeda hedged position of net zero is worse than no position because:
even if a position is hedged at net zero it is not "safe". If the spread widens 100 pips you could potentially get a MC. As the P/L of the long will depend on the BID price and the P/L of the short will depend on the ASK price, these are two separate prices with obvious correlations, but don't always move in the same direction, e.g. under extreme market conditions.
where as if you have no position you not exposed to this riskIgnored
DislikedYou can achieve exactly the same result without 'hedging':
-- Hedged both long and short = net zero = same as being out of the market
-- Closing one of the hedged positions = leaves you net long or short = same as opening a position long or short
Every stance in the market is either net long X lots, net short X lots, or net zero. You can achieve it either with or without 'hedging'. It's not the hedge itself that determines the P/L, it's your net position relative to whether price is rising or falling.Ignored