Is betting a currency on both sides at the same time generally a bad idea? For example, isn’t betting USDJPY long and EURUSD long betting the USD against itself?
Many thanks.
Your long and short exposure to USD at the same time in two positions effectively means no profit and no loss from USD price movement. They cancel each other out. Therefore you are left with a short position on JPY and a long position on EUR, which of course is achieved more practically and with only half the cost overheads by simply buying EUR/JPY.
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Yea, also this is like hedging against yourself, which is not a good thing. If you go long USDJPY and EURUSD, you are basically trying to point out that USD will both strengthen and weaken at the same time.
Not a worst idea in some cases, but it is best to focus on one clear direction to avoid conflicting trades
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Yes. It’s the same as buying EUR/JPY but you’re unnecessarily paying two commissions/spreads instead of one.
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