NEW MT5 Seriously Stuffing Traders

[phil838]

Originally Posted by Sweet Pip

Here's one...

MetaTrader 5

Thanks Sweet Pip, that article makes sense!

It appears it's true that MT5 will not allow hedging orders, no matter if the broker is US based of not.

Here's a piece of the article...

"The order management system has completely changed in Metatrader 5. Now an order is a request to execute a trade operation, the result of which can be a trade. A position is the total state of trades on a certain financial security. Any financial security can have only one position. Unlimited orders are possible but with only one resulting position per pair. This means that there won't be possible to hedge orders anymore. According to Metaquotes, this change in the trading system was made to make MetaTrader 5 compatible with other markets, where such system is a standard. Now MetaTrader 5 allows working on the much wider range of markets, than MetaTrader 4. And that was a reason to rewrite the trading system totally.

So MT5 will take away the hedge ability by offsetting long and short trades into one position (NFA ruling compliance*). If this is case, it is very bad news to many traders who use hedging as part of their trading strategy. Moving accounts from US to UK or other countries which still allow hedging will be pointless once brokers start switching to the Metatrader 5 platform."

[o990l6mh]

Originally Posted by phil838

Thanks Sweet Pip, that article makes sense!

It appears it's true that MT5 will not allow hedging orders, no matter if the broker is US based of not.

Here's a piece of the article...

"The order management system has completely changed in Metatrader 5. Now an order is a request to execute a trade operation, the result of which can be a trade. A position is the total state of trades on a certain financial security. Any financial security can have only one position. Unlimited orders are possible but with only one resulting position per pair. This means that there won't be possible to hedge orders anymore. According to Metaquotes, this change in the trading system was made to make MetaTrader 5 compatible with other markets, where such system is a standard. Now MetaTrader 5 allows working on the much wider range of markets, than MetaTrader 4. And that was a reason to rewrite the trading system totally.

So MT5 will take away the hedge ability by offsetting long and short trades into one position (NFA ruling compliance*). If this is case, it is very bad news to many traders who use hedging as part of their trading strategy. Moving accounts from US to UK or other countries which still allow hedging will be pointless once brokers start switching to the Metatrader 5 platform."

In that case i have to agree with Aquaart's initial bashing of MT5.

[Sweet Pip]

Originally Posted by phil838

Thanks Sweet Pip, that article makes sense!

It appears it's true that MT5 will not allow hedging orders, no matter if the broker is US based of not.

Here's a piece of the article...

[i]"The order management system has completely changed in Metatrader 5. Now an order is a request to execute a trade operation, the result of which can be a trade. A position is the total state of trades on a certain financial security. Any financial security can have only one position. Unlimited orders are possible but with only one resulting position per pair. ]

So searching out more info...kinda of a hot forum topic recently lol...it seems a position is a "melting pot of orders"...or trade executions. So you can initially buy a pair, add to it (by modifying the position), then sell some of it (again by modifying the position), set up a pending order to buy or sell into the position, etc.

Before, each order opened was maintained as an individual entity... now it won't be anymore (per pair that is), ....and any EA that looks at orders individually will probably not work properly. Good luck to anyone with an EA that is no longer supported by the creator. ...or pirated..lol

Another point I read about hedging is that it can be done without actually opening new orders, thereby not incurring further spread costs. Correct me if I'm wrong , but with the new position based trading, if you have an overall "net long position", then see a countertrend trade setup, instead of the old order-based method of opening a new sell order with the spread cost, the new way would be to sell off some of the existing position instead, and re-buy it in the dip..at a better price....and no spread!...hmmmm interesting...

[aquaart]

Originally Posted by phil838

I understand what you're saying, I just don't see where the idea that MT5 will not do this is coming from.

Does someone have a reliable source for this information? The original pictures posted in this thread don't have anything to do with this. They are explaining the new way MT5 is using the terms trade, position, etc...

Yes, but I wasn't allowed to post it in the forum, I think it was considered advertising... But hopefully I can do this... do a google search including (FX1618 and the inverted commas) on:

FX1618 "MetaTrader 5 - Coming soon..."

What the diagram means is, you will be able to trade in both directions BUT...

It amalgamates every trade into one overall position, so that it obeys NFAs position trading rule. Diagram 2 that I showed in the first post is from review that I read.

What it means is that after placing 2 lots worth of BUY orders, if you place a 3 lot sell order, it will be SELL 1 lot overall.

In other words the the 3 SELL cancelled the 2 BUY with one SELL left over.

What they are trying to show in the diagram that I keep on referring to... is that with MT4 brokers each trade was considered its own individual position, while with MT5 brokers all trades are amalgamated into a single position.

[aquaart]

Originally Posted by Sweet Pip

I read about hedging is that it can be done without actually opening new orders, thereby not incurring further spread costs. Correct me if I'm wrong , but with the new position based trading, if you have an overall "net long position", then see a countertrend trade setup, instead of the old order-based method of opening a new sell order with the spread cost, the new way would be to sell off some of the existing position instead, and re-buy it in the dip..at a better price....and no spread!...hmmmm interesting...

Partial profits really are the splitting of 1 overall position into 2 or more trades. And adding to a position is the combining of 2 trades (or more) into 1 overall position.

Otherwise, the above statement would mean that trading would become free if a trader was smart enough to keep a position open at all times.

How can that be????