Is there a way to hedge on the platform. Reason I ask is that I was long XAU it went against me so I went short at least thats what I thought I was doing. But, instead of going short It sold off my long position, so I ended up with no positions open. If it isn’t possible to hedge on Oanda. Does anyone know of a good easy to use platform that does offer this feature?
The same thing happened to me and O. said the only way to take an opposite trade is open and fund a sub acct. d.
The net result of what Oanda did was exactly what the net effect would be on your equity if you did an opposing “hedge” as another position.
Please explain to me what you think you would be accomplishing by opening a short to “hedge” a long trade that’s going against you.
My open position was going against the trend. So if I hedged it I could remove the hedge once my position reversed and started following the trend. Any advice is very welcome. I’m pretty new at this and am just learning. Thanks:D
That’s true, Even I had this “super-brilliant” idea and tried many brokers, they did not allow me to “hedge” it, If i try shorting the position, they would sell my longs etc.
One solution would be, use 2 different brokers, atleast that’s what I am trying to do.
Do the math and figure out whether you are actually at all better off doing that “hedge”. I’m serious here. Take all the gains and losses, carry, rollover and whatever, and figure come up with a combined P/L. Then compare that to what it would have looked like had you just closed out the initial trade and reopened it again later if the market started going back in your favor. Let us know what you come up with.
There’s an important lesson here for you and a lot of other new traders.
Exactly…
It’s always good to have single trade (long or short) open with the trend, instead of “juggle”. The difference is always the spread price.
Correct me if I’m wrong but it seems like it works out to be about the same.
You are wrong, by a little. Yes, mainly it works out the same. However, because you are putting on a new trade you have the spread working against you a second time - so from a pure P&L point of view you lose the spread on this so-called hedge. There’s an additional element as well - the carry. Becuase the carry interest is also bid-ask based, you will come out negative on that as well.
Bottom line is the “hedge” loses money - guaranteed.