OANDA - are they joking!!?

[everyonerich]

for those wanted to use OANDA, pls beware that their platform DO NOT ACCEPT hedging method of trading


for eg:

you have 1 opened buy position, and if market go against you and you wanted to sell exactly the same pair, once the sell executed, your previous buy position WILL DISAPPEARED!! the platform will closes the previous buy position.. LOL.

i asked the live chart support, and they told me to open another sub-account. so fine, later i asked if the sub-account can share the same capital with the 1st account. and they said both account would be administered separately!!

that means, even if your buy position on 1st account is having drawdown, then you opened another short at sub-account. you still wont protected if market keeps going against you on 1st account.

 

[MrGecko]

What?

You buy something, then you sell it, so the position disappears.

So what?

 

[everyonerich]

What?

You buy something, then you sell it, so the position disappears.

So what?

you cant even hedging, for eg: protect the buy position (not closing it by stupid broker) wait until profit then close again

 

[MrGecko]

err...

if you have a Long position, say 1 lot of GBPUSD

then you sell 1 lot of GBPUSD because the trade is going against you, so you want to "hedge"

your net exposure is 0.

 

[KillPhil08]

If you changed your direction because you want one position to get out at a top and the other at a bottom to make your losing position profitable, it's the same as closing your trade then re-opening it at the top or bottom...

I'm guessing this is what you wanted to do.

 

[chilltrader]

Hedging is really misundertood.

Dont see the point in hedging on the same instrument (unless its different contract months)

Mostly hedging is done on different - but related - instruments.

Buying "spot GBP/USD" and selling "spot GBP/USD" to "hedge" doesn't make sense.

 

[MrGecko]

And anyway - the only real hedging that you can do in currencies (ignoring interest rate exposures) is the "I'm going on my hols, and I want to lock in the rate I can get on my spending money" hedge.

Hedging one pair with another is a total misnomer.

 

[zupcon]

Buying "spot GBP/USD" and selling "spot GBP/USD" to "hedge" doesn't make sense.

It makes absolutely no sense at all, and yet brokers actually offer this facility, and sell it as an advantage to people without the intellectual capabilities to see the falacy

Its funny isnt it, why would someone who couldnt manage a single position suddenly find the skills to manage two or more positions ?

 

[MrGecko]

GJ, you should be able to enlighten me on something:

Would you trade two forwards with different expiries, in the same way you might trade a STIR spread? Say go long on the 12m and short the 6m, sort of trading the "term structure of exchange rates".

Is this done in the IB market at all?

 

[arabianights]

I can think of one circumstance when this might make sense, when identical contracts are listed on different exchanges... it is cheaper for you to trade on exchange A but the market is more liquid on exchange B... you might have to 'hedge' your position on A by going into B to close it.

But yeah, I concur with the 'retard' assessment

 

[Hoggums]

Agreed - there's no point opening a positionin the opposite direction. Just close the original and then re-open it again later. That way you'll actually save money because you are not paying the extra spread on the hedge trade.

You need to look at your psychology and why you cannot accept the loss initially but want to open a position in the opposite direction. The net effect will still be the same if you close the original position.

 

[everyonerich]

its simple, you cant temporary open another opposite position to protect it, before waiting in positive zone again then close with profit or zero stoploss. i'll use other broker other than oanda

 

[MrGecko]

I can think of one circumstance when this might make sense, when identical contracts are listed on different exchanges... it is cheaper for you to trade on exchange A but the market is more liquid on exchange B... you might have to 'hedge' your position on A by going into B to close it.

But yeah, I concur with the 'retard' assessment

I guess this happens across liquidity pools? Say you opened a position on Hotspot and (Provided the positions are fungible) have to close it in Currenex, because thats where the best price is at the time?

 

[foredog]

its simple, you cant temporary open another opposite position to protect it, before waiting in positive zone again then close with profit or zero stoploss. i'll use other broker other than oanda

If you are long 1 and sell 1 you are NOT doing anything temporary, you're closing that position.

Call it any name you fancy but to sell the exact position in the exact instrument as you hold is just closing out that trade.

 

[Hoggums]

It makes absolutely no sense at all, and yet brokers actually offer this facility, and sell it as an advantage to people without the intellectual capabilities to see the falacy

Its funny isnt it, why would someone who couldnt manage a single position suddenly find the skills to manage two or more positions ?

Just to give another point of view....

Actually I find this an advantage with IG because it allows me to run 2 separate systems (one longer term - one short term) without them interfereing with each other. It means my stops and limits are maintained even if another system says go short when I am already long. If the trade was closed I'd have to re-work out where to put orders on to maintain the same effect.

However these are completely unrelated trading methodologies. Going short to hedge out an existing long doesn't make sense.

 

[MrGecko]

open another opposite position to protect it

err... just close the position you are in?

i'll use other broker other than oanda

NOOOOOOOO!!!!!

 

[arabianights]

Know nowt about FX... I think this would only make sense in reasonably obscure examples, generally when a contract is transitioning from one exchange to another, e.g. JGBs and Bunds on LIFFE.

 

[everyonerich]

If you are long 1 and sell 1 you are NOT doing anything temporary, you're closing that position.

Call it any name you fancy but to sell the exact position in the exact instrument as you hold is just closing out that trade.

so lets say i have several trading method, and i occasionally wanted to scalp and some long term... tell me how to prevent the scalping position affect the long-term position? OANDA messed it up! lol

 

[foredog]

so lets say i have several trading method, and i occasionally wanted to scalp and some long term... tell me how to prevent the scalping position affect the long-term position? OANDA messed it up! lol

Eh, have i missed something.

Have two accounts, one for long term, one for scalps

Regardless of having two different strategies running if you sell the same amount that you hold you've closed that position. If you buy again in 10 seconds then surely thats a new postion.

and does it really matter how they do it.

simple fact is your long 1, you sold 1 where you wanted to and bought them back lower didn't you?

When you effectively hedged as you describe it you ha no position and your account showed that.

 

[MrGecko]

If you need to do it for bookeeping purposes, then no problem.

If you need to do it because you think it reduces your exposure, then you should get back to the drawingboard.