Hedging and Direct Hedge strats. I live Outside America. what is allowed/not allowed on mt4.

[Inkster]

Hi Ive been Learning to trade for a few months now. I have tried various Strategies but I was curious about the Hedging strategies. Ive heard you can take a position on a short and long but are there any rules and can we keep a trade open indefinately. Also are there chances of a penalty if something is not followed. Such as account reaching a negitive balance. Thanks in Advance for the Advice. Keep up the good work.

 

[JimmyRozza]

I believe it depends on your broker and where they are registered as they all follow different rules, depending on their governing body.... Check out the terms and conditions to make sure you are happy before signing up. Or set up a demo account and have a play.
If the platform won't place a hedge, then the chances are they don't allow it (I think this is only for US registered firms, but there could be other countries).
I have my own hedging strategy, but it's still in its infancy, so don't want to share until it's a little more tried and tested.

 

[fxoday]

Different broker I think has own policy regarding hedging, if I am not wrong most brokers in America don't allow hedging, but broker outside the US might allow this strategy, so if choose the broker also needs to check for this matter if you want to trade based hedging.

 

[perryjohn765]

That totally depends on the broker and their trading conditions. So one can definitely try all this if the broker allows.

 

[Pharaoh]

You can always "cheat" and get some hedging power out of correlated pairs. One good example is the HKD is manipulated to keep it in a very narrow band against the USD, so if you've got a broker with HKD pairs, you can use the HKD as a proxy to the USD. Most other correlations are not so tightly defined.

Or, do a 3 way hedge. For example, you want to hedge an EURUSD long position:

Go short on EURGPB and Short on GBPUSD. Calculating the position sizes will take some math, but if you can get close, those 2 shorts will roughly equal your long position.

I have my own hedging strategy, but it's still in its infancy, so don't want to share until it's a little more tried and tested.

Test it thoroughly on demo first. When you are ready, try it on a broker that lets you trade microlots.

 

[Keithstyles1]

Different broker I think has own policy regarding hedging, if I am not wrong most brokers in America don't allow hedging, but broker outside the US might allow this strategy, so if choose the broker also needs to check for this matter if you want to trade based hedging.

Hi Ive been Learning to trade for a few months now. I have tried various Strategies but I was curious about the Hedging strategies. Ive heard you can take a position on a short and long but are there any rules and can we keep a trade open indefinately. Also are there chances of a penalty if something is not followed. Such as account reaching a negitive balance. Thanks in Advance for the Advice. Keep up the good work.

Check with your broker and there trading conditions