Can you be long and short at same time?

This is a discussion on Can you be long and short at same time? within the Discretionary Trading forums, part of the Methods category; Originally Posted by graydrake Flash this is a calendar spread. Check the published definitions and advantages. Drake that can work ...

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Old Apr 26, 2013, 2:27pm   #16
 
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Re: Can you be long and short at same time?

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Originally Posted by graydrake View Post
Flash this is a calendar spread. Check the published definitions and advantages.

Drake
that can work then. The initial post did not say that
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Old Apr 26, 2013, 4:00pm   #17
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Re: Can you be long and short at same time?

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Originally Posted by Lord Flasheart View Post
How can this benefit you,if you go long and then add in a short then you are flat whatever the movement so whats the point.
Hi Flash,
Potentially, it can be of benefit in a number of ways . . .

1. As I mentioned in my last post, it obviates the need for stops, which are the bane of most traders lives. (Please note: I'm saying this as an ordinary member - not with my T2W hat on. I would not recommend this to newbies for whom stops are essential.)
2. Positions equally weighted on both long and short legs of the trade will protect you from any losses when no clear direction is indicated. As and when the market makes its move, you have the option to adjust your weighting on either side of the scales so to speak. You literally have double the number of options at your disposal, as you can add or reduce your position size on both legs of the trade.
3. It enables you to average into a position without incurring additional risk. I'm loathed to recommend other sites (hope Steve isn't reading this thread or I'll be in trouble, lol) but there's a thread on ET that discusses this in some detail that's worth a gander IMO: Averaging Down

As I say, I'm just experimenting with a demo account at the moment. So far, what I like most about is that it's a much more relaxed way to trade. How many times have we panicked and got out of a trade too soon, or hung on for even more profit and ended up giving profits back to the market? Opening an opposing position gives you time and breathing space without having to close out your main position.

Have a good weekend all.
Tim.
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Old Apr 26, 2013, 4:10pm   #18
 
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Re: Can you be long and short at same time?

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Originally Posted by timsk View Post
As I say, I'm just experimenting with a demo account at the moment. So far, what I like most about is that it's a much more relaxed way to trade. How many times have we panicked and got out of a trade too soon, or hung on for even more profit and ended up giving profits back to the market? Opening an opposing position gives you breathing space without have to close your main position.

Tim.
Hey Tim, help me out here if you would..I've always thought it could be a really useful way, but at some point in time, you have to exit one or both of these, so you can either be nett zero (which doesnt really help, as you would most likely have incurred charges) or one of them has to be at a loss.
Lets say I short the FTSE at 6000, and immediately I enter one in the opposite direction..so price drops down to 5900, you are nett zero, having incurred a charge. You close your long as you are super confident its going down, so you incur a 100 loss, and an open profit of 100..now prices start retracing. Your profit is going down, incurring a loss regardless.
I can never get my head around the benefit, unless your timing was right to begin with, in which case your stop would have been just as effective
Am I making sense?
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Old Apr 26, 2013, 4:27pm   #19
 
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Re: Can you be long and short at same time?

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Originally Posted by timsk View Post
Hi Flash,
Potentially, it can be of benefit in a number of ways . . .

1. As I mentioned in my last post, it obviates the need for stops, which are the bane of most traders lives. (Please note: I'm saying this as an ordinary member - not with my T2W hat on. I would not recommend this to newbies for whom stops are essential.)
2. Positions equally weighted on both long and short legs of the trade will protect you from any losses when no clear direction is indicated. As and when the market makes its move, you have the option to adjust your weighting on either side of the scales so to speak. You literally have double the number of options at your disposal, as you can add or reduce your position size on both legs of the trade.
3. It enables you to average into a position without incurring additional risk. I'm loathed to recommend other sites (hope Steve isn't reading this thread or I'll be in trouble, lol) but there's a thread on ET that discusses this in some detail that's worth a gander IMO: Averaging Down

As I say, I'm just experimenting with a demo account at the moment. So far, what I like most about is that it's a much more relaxed way to trade. How many times have we panicked and got out of a trade too soon, or hung on for even more profit and ended up giving profits back to the market? Opening an opposing position gives you time and breathing space without having to close out your main position.

Have a good weekend all.
Tim.
No stops, averaging down...what's going on here?

Going long and short the same underlying instrument with the same size, is being flat. There's no other way to spin it. Options trades with different strikes are a different issue, that's being long one instrument short another. Long and short different expiries, calendar spreads...again trading two different instruments.

Surely this debate has been done to death. If you think being flat (sorry being long and short at the same time) is going to help you make money, you're just kidding yourselves.
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Old Apr 26, 2013, 4:36pm   #20
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Re: Can you be long and short at same time?

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. . . Surely this debate has been done to death. If you think being flat (sorry being long and short at the same time) is going to help you make money, you're just kidding yourselves.
Hi Shakone,
Well, it's been done to death in as much as the same basic points have been made time and time again - such as the second sentence of yours that I've quoted - with which I completely agree!

Tim.
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Last edited by timsk; Apr 26, 2013 at 4:46pm.
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Old Apr 26, 2013, 4:45pm   #21
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Re: Can you be long and short at same time?

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. . . I can never get my head around the benefit, unless your timing was right to begin with, in which case your stop would have been just as effective. Am I making sense?
Hi malaguti,
Yes, you're making perfect sense! I'm not presenting this as some kind of Holy Grail, or saying that it's a better solution than mainstream practices and conventional uses of stops etc. All I'm saying is that I'm open minded to the ideas and am willing to explore them for myself, based on what others have said who incorporate them into their trading practice. For those of you who have already been down this particular avenue and found no merit in it - that's absolutely fine. I might well arrive at the same conclusion myself. That said, I'm always wary of dismissing something out of hand, because, if there's one thing I've learnt during my time here at T2W - every time someone says something's complete hogwash or can't be done - there's usually someone doing it!
Tim.
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Old Apr 26, 2013, 4:50pm   #22
 
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Re: Can you be long and short at same time?

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Originally Posted by timsk View Post
Hi malaguti,
Yes, you're making perfect sense! I'm not presenting this as some kind of Holy Grail, or saying that it's a better solution than mainstream practices and conventional uses of stops etc. All I'm saying is that I'm open minded to the ideas and am willing to explore them for myself, based on what others have said who incorporate them into their trading practice. For those of you who have already been down this particular avenue and found no merit in it - that's absolutely fine. I might well arrive at the same conclusion myself. That said, I'm always wary of dismissing something out of hand, because, if there's one thing I've learnt during my time here at T2W - every time someone says something's complete hogwash or can't be done - there's usually someone doing it!
Tim.
Im open minded too, but this I've done in my head, not like you and possibly exploring this for real. Perhaps I will try to look at those that have already tried incorporating..
thanks though Tim
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Old Apr 26, 2013, 4:57pm   #23
 
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Re: Can you be long and short at same time?

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Originally Posted by Shakone View Post
No stops, averaging down...what's going on here?

Going long and short the same underlying instrument with the same size, is being flat. There's no other way to spin it. Options trades with different strikes are a different issue, that's being long one instrument short another. Long and short different expiries, calendar spreads...again trading two different instruments.

Surely this debate has been done to death. If you think being flat (sorry being long and short at the same time) is going to help you make money, you're just kidding yourselves.

I see it as a way of managing a trade - like another tool albeit at a small fraction of a cost.

One can enter a trade based on long TF; monthly or weekly charts and based on targets hold a trade whilst taking short TF trades on daily or hourly charts; scalping.

Sometimes before big news I often put two trades in and then forget about it. When big moves happen it's easy money for little gain. Best not to have an opinion on direction and marry a losing position. The hardest part is closing a losing trade with two trades; it's not that hard really.

Horses for courses.
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Old Apr 26, 2013, 5:03pm   #24
 
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Re: Can you be long and short at same time?

Ok, I am flat, the market moves I am unaffected. Trader A enters a long and a short, pays the spread twice, he is unaffected by the markets movement but is down two times spread. trader B enters 1000 long, 1000 short, he is unaffected by the movement of the market but is down 2000 times the spread. Do I need to go on?
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Old Apr 26, 2013, 5:19pm   #25
 
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Re: Can you be long and short at same time?

I'll try and post 2 x live trades next week when there's likely to be lots of news.

EURJPY may be a good candidate in couple of weeks time as it's likely to see/have some big moves.
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Old Apr 26, 2013, 5:43pm   #26
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Re: Can you be long and short at same time?

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Originally Posted by Gregpearce32 View Post
I follow solely usdjpy on m1 timeframe,
If i take long term long position at bottom of range market,
Can you take short positions while markets take small downmoves within the range?
(I use mt4 with Alpari)

Any advice would be great
Greg

Hypothetically, in principal, it's workable. But, you need to be able to overcome various negating factors.

Within what market times do you place most of your orders?
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Old Apr 26, 2013, 6:19pm   #27
 
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Re: Can you be long and short at same time?

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Originally Posted by Atilla View Post
I'll try and post 2 x live trades next week when there's likely to be lots of news.

EURJPY may be a good candidate in couple of weeks time as it's likely to see/have some big moves.
Why wait? Just choose a hypothetical move, however you want the price to move and show how it would be helpful to be both long and short.

Last edited by Shakone; Apr 26, 2013 at 6:31pm.
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Old Apr 26, 2013, 6:30pm   #28
 
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Re: Can you be long and short at same time?

I think if you are at the stage where you can hold a winning position day trade AND run several winning scalp trades in either direction whilst your position day trade makes $$$ for you, then you are probably in a position to have more than one SB/DMA account to do it with.

Just open another account. I can't see any upside in trying to do it in one account, seems like a good way to fumble your way out of the position trade.

My hat off to you if you are this good though!
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Old Apr 26, 2013, 6:38pm   #29
 
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Re: Can you be long and short at same time?

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Originally Posted by timsk View Post
Hi Flash,
Potentially, it can be of benefit in a number of ways . . .

1. As I mentioned in my last post, it obviates the need for stops, which are the bane of most traders lives. (Please note: I'm saying this as an ordinary member - not with my T2W hat on. I would not recommend this to newbies for whom stops are essential.)
2. Positions equally weighted on both long and short legs of the trade will protect you from any losses when no clear direction is indicated. As and when the market makes its move, you have the option to adjust your weighting on either side of the scales so to speak. You literally have double the number of options at your disposal, as you can add or reduce your position size on both legs of the trade.
3. It enables you to average into a position without incurring additional risk. I'm loathed to recommend other sites (hope Steve isn't reading this thread or I'll be in trouble, lol) but there's a thread on ET that discusses this in some detail that's worth a gander IMO: Averaging Down

As I say, I'm just experimenting with a demo account at the moment. So far, what I like most about is that it's a much more relaxed way to trade. How many times have we panicked and got out of a trade too soon, or hung on for even more profit and ended up giving profits back to the market? Opening an opposing position gives you time and breathing space without having to close out your main position.

Have a good weekend all.
Tim.

Tim it still doesnt help at all. If you are two short and one long,you might as well be one short,it has exactly the same affect without paying more costs.
Sure it may not cause you to panic to get out of a trade because you wont have a trade if you are one short and one long. You wouldnt go into a casino and bet 10 on red and 5 on black when you can just be 5 on red and not risk the zero.
As for hanging on for more profit,you wont have anymore profit because the hedging position has lowered the profit. However I look at this there's no way it can be of benefit unless you are using different contracts.
And worst of all Tim,what if it spikes or gaps, you could be in a real mess.
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Old Apr 26, 2013, 6:43pm   #30
 
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Re: Can you be long and short at same time?

It's a good way to get your broker to love you....
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