DislikedYes, I agree that as positions are put on both sides any large open profit (long) will be offset 'somewhat'.
'Somewhat' is the important word though because IF the market had been in a long uptrend then loads of long positions should have been built up. Now, if the market takes its time to turn around then yes, a trader would probably have time to build a reasonable short position.
But what happens if the markets go crazy and suddenly crater like 2007/08?
Then years of built up long profits would be given back with very few chances to build...Ignored
Completely agree. Simple solution = Have more than one strategy. Institutional funds with mandates for low drawdown do this.