Hedging is it really useful?
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Thread: Hedging is it really useful?

  1. #1

    Hedging is it really useful?

    May I ask what the advantages of hedging your exposure are compared to shutting the position?

    I see so many people with this forums stating that they don't want to give the broker their money but by hedging you are basically locking in your adverse balance on the equity aspect that's exactly the same as shutting the trade straight away.
    If you want to believe that the commerce could be profitable in the future and currently is merely a correction why not close and reopen the trade later on?
    Should you market a long position by entering a short trade which you still need to buy back the lots if you would like to publish the Dollar leading precisely to the scenario as starting a new buy at this time.

    There even is the downside that you need to pay interest on open position and also for some broker you lower your margin you can use.

    I understand There Are a Couple of situations where hedging can be useful:Should you construct some kind of payout (e.g. options) and partially hedge risk you use another financial instrument because of insufficient money in 1 market or because of spread money in different accounts that you would like to hedge against a particular sort of risk / dollar impartial or sector risk etc.. . But in regards to the ideal hedge in Foreign Exchange this does not apply.

    Hedging enables you to control your data by postponing a loss, shifting your win/loose data or various other ratios but overall it will not have a beneficial impact on your account.

    What am I missing here?
    The only real reason I can see here is that it simplifies your own order management if you have several positions open in different directions with different sls and tps. Employing just a little bit of math and partially closing or adding places on the fly could also achieves this. It doesn't matter at what price you entered into a position so long as long you maintain your exposure is the same.

  2. #2
    Quote Originally Posted by ;
    Mathematically looks exactly the same, but gambling isn't about that. .... An opportunity is given by hedging. Or perform an range. .... Hedging is to prevent losses. SL is to realize it.
    Inspired by their opinions, most folk who believe that same-pair hedging offers a egic advantage have a tendency to think in terms of private trades, instead of overall bottom line. The traders take this 1 step farther: they base their own exits on market behaviour and probabilities, as compared to their P/L, which the market cares nothing about.
    Quote Originally Posted by ;
    Together with sl players keep tripping.
    There are plenty of profitable traders who use SLs. If you're getting stopped out repeatedly, then figure out why and adjust your SL levels (and probably your entries) accordingly. Watch hundreds of intraday price charts unfold tick by tick, study what is occurring, and connect the side of these predators as opposed to the prey.
    Quote Originally Posted by ;
    Illuing the way to win in a losing match isn't accurate.
    Trading isn't a losing match -- if you have the essential knowledge and expertise.
    ___________________

    @everybody: Happy new year. Lots of pips in 2016!

  3. #3
    Quote Originally Posted by ;
    quote In my interpretation they aren't similar. image
    Killian here is my interpretation of your image



    I apologize for the absence of any paint ability

  4. #4
    My expertise in market is useful when you make error in range moments. That give you changes for recuperate the trade. This occurred in GU two months. But you have that poor trade when you have confirmation of range fracture. As you never know when market will return. Occasionally never return if this happends in very extremes prices ( 1.80 at GU for example ).

  5. #5
    You contended and provided proof that SL and self explanatory mathematically produces the same result. And I concur with this.

    Quote Originally Posted by ;
    There are plenty of profitable traders who use SLs.
    If the two of your statements are accurate, then hedging must do the same.

    However, re-quote myself:
    Mathematically looks the same, but gambling is not about that. .... An opportunity to move the bet off is given by hedging. Or play with an other range. .... Hedging is to prevent losses. SL is to realize it.

    You somehow can't see this, and if you are lucky, you don't need to.

    Quote Originally Posted by ;
    If you're getting stopped out , then figure out why and adjust your SL levels (and likely your entrances ) accordingly.
    Since the price gets transferred to the other direction.

    Quote Originally Posted by ;
    Trading is not a losing game -- if you have the necessary knowledge and expertise.
    Slimming for 95% - non losing for 5%. Knowledge and expertise does not lead to success. Simply luck if everybody likes to deny it.

  6. #6
    Quote Originally Posted by ;
    If both of your statements are true, then hedging should do exactly the same.
    Yes, given the same price levels, SL and and same-pair-hedging are alike profitable (when we discount the extra swap prices ). My argument has always been contrary to the notion that same-pair-hedging can be more profitable than using traditional exits.
    Quote Originally Posted by ;
    You somehow can't view it
    I do not want to repeat what I have written dozens of times before. Each one of us thinks that he can see something that the other can't.
    Quote Originally Posted by ;
    Knowledge and expertise does not lead to achievement. Simply luck, even if everyone likes to deny it.
    In that case, there is not any purpose in continuing this discussion.

  7. #7
    Quote Originally Posted by ;
    quote Yes, provided the exact same price amounts, SL and also same-pair-hedging are equally profitable (if we discount the excess swap prices ). My argument has always been contrary to the idea that same-pair-hedging could be more profitable than using conventional exits. quote I'm not going to repeat what I've written dozens of times before. Every of us believes he can see some thing that another individual can not. quote In that scenario, there is no purpose in continuing this discussion.
    Utilize a swap-free account if you want to hedge, there are plenty of them, do you guys think is a fantastic time to hedge AUD? Plan to start buying 0.01 lot @0.72

  8. #8
    At present I am not keen to hedging whatsoever, because I have terrible experience when work utilizing hedging, loss more wider than regain loss, hard part with hedging when should start lock hedging, it really is similar to as dilemma, if great in analysis might potential become profit, however when wrong the way also will making loss longer.

  9. #9
    Should realize we have several approaches.

    I use two egies and I frequently have trades open in both directions
    Trades can run for minutes or for days or weeks.
    I don't call it hedging, I call it ching trading opportunities.
    Given the contrary trades open and close at different times, they can be profitable.

    I also do this for risk minimization.
    Having trades open in only 1 way sets our account at risk.
    Ask yourself, How large a spike can your account handle?
    100pips? 500 pips? 1000pips?
    Are you going to be in trouble when your account abruptly goes to -1000 pips?

    If your response is yes, then maybe you'll need to reevaluate your lot size.
    If you will find trading opportunities in the contrary direction, and your egy permits it, why not take them?
    Something to think about.

  10. #10
    Quote Originally Posted by ;
    quote Can you explain me the difference between getting open: 1) 4 lots long and 2.5 short 2) 1.5 lots long
    Are you asking because you do not understand the difference?
    The purpose of my article is that there Are Several Ways to trade

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