Can you be long and short at same time?

[Lord Flasheart]

Why are you SO bothered about people agreeing with me?

This should be an adult discussion rather than a playground fight - for god's sake man, grow up.

And you still haven't given me one logical reason why what I'm doing isn't giving me good market POSITION.

my words are just word of expression,shock or disbeleif,its just the way I feel and certainly not childish.
As Ive said you dont have a market position if you are flat. Your are only in a market position when you have a net long or short.

 

[x4x]

Hi 4x4

Interesting strategy.

This may have already been covered and I have read this thread from the start but may I ask the following:

Do you place both trades (short and long) at the same time. ie, within minutes of each other?

Do you place both trades (short and long) on the same instrument?

Also, which trade do you cut out first, the one in profit or the one in loss or does this change?

Cheers,
Lee

No, their usually hours apart, and I only do it if trends are mixed. I trade trends and support and resistance - which in my book both vary from time frame to time frame. In my current trade - I'm long off daily support (up trend) and short off 1H resistance (down trend).

Yes, the spot price.

Usually, both trades are positive, it's rare I am long and short a (nett) negative position, but it can happen, and if I am it is often only for a few minutes as my stops are fairly tight, typically 13 - 25 points.

If I can close half at equal to or better than my risk, I do so. This gives me a free, no risk trade without having to move my stop loss closer - I usually sacrifice one or the other trade, sometimes for loss, sometimes for a small profit or at break even.

I watch 8 markets, if I see a correlated move across the board, I will keep adding positions - this is rare these days, but it does still occasionally happen.

Mostly, the strategy is about gaining the right entry in the market and holding a position - not about trying to grab 20 pips or so.

 

[x4x]

my words are just word of expression,shock or disbeleif,its just the way I feel and certainly not childish.
As Ive said you dont have a market position if you are flat. Your are only in a market position when you have a net long or short.

If they can see even just a glimpse of logic behind the way I trade, why does that bother you enough that you feel the need to call them out - aren't they allowed an opinion.

I'm talking about entry and stop position, I have two good entry and stop loss positions, with no risk - one will eventually win out, or I'll close both and book my profit.

 

[robster970]

That's interesting - you are basically paying commissions twice for getting a better entry location in an area where the turn may be ambiguous then?

 

[x4x]

That's interesting - you are basically paying commissions twice for getting a better entry location in an area where the turn may be ambiguous then?

I use IG, so there are no commissions, just the spread and overnight costs.

I had a long off daily support and a short off 1H resistance - I was just doing my job and entering when my system told me - I don't want to close either trade because they're both good entries, and I would rather hold the trend that wins out - no one yet has told me which entry I should have ignored the daily trend or the 1H trend.

The costs are immaterial to me, it's around 5 points per night - I have a current open profit of 93 points - worrying about a 5 point cost is akin to worrying about a 5 point market pull back. I can tighten my top & bottom stops by 2.5 points each, to cover o/n costs if I want to - but I'd rather leave them where they are for the time being.

 

[tar]

The costs are immaterial to me, it's around 5 points per night - I have a current open profit of 93 points - worrying about a 5 point cost is akin to worrying about a 5 point market pull back. I can tighten my top & bottom stops by 2.5 points each, to cover o/n costs if I want to - but I'd rather leave them where they are for the time being.

As a side note you are not doing the right comparison here , you should compare your costs per trade to average profit/trade , lets say you net 500 pips after 80 trades a month ( remember you trade more because of your hedging strategy ) , so your average profit/trade here is just 6.25 pips not 93 pips .

 

[tar]

Costs for daytraders are not immaterial : e.g lets say an average daytrader trades cable 50 times a month so that's 150 pips in costs on average including slippage = 1800 pip a year which is more than this year range for the Pound ! Ofcourse most daytraders trade more than 50 times a month ...

 

[robster970]

I use IG, so there are no commissions, just the spread and overnight costs.

I had a long off daily support and a short off 1H resistance - I was just doing my job and entering when my system told me - I don't want to close either trade because they're both good entries, and I would rather hold the trend that wins out - no one yet has told me which entry I should have ignored the daily trend or the 1H trend.

The costs are immaterial to me, it's around 5 points per night - I have a current open profit of 93 points - worrying about a 5 point cost is akin to worrying about a 5 point market pull back. I can tighten my top & bottom stops by 2.5 points each, to cover o/n costs if I want to - but I'd rather leave them where they are for the time being.

OK - I get what you are doing. I also understand that the reason 5pips/ticks/pts is irrelevant to you is because of the TF and frequency with which you trade.

One question though - why not just come out of the long at the 1h short signal and then re-initiate the long where you would have covered the short? I am assuming you are using the same position size for the daily and the hourly.

 

[x4x]

As a side note you are not doing the right comparison here , you should compare your costs per trade to average profit/trade , lets say you net 500 pips after 80 trades a month ( remember you trade more because of your hedging strategy ) , so your average profit/trade here is just 6.25 pips not 93 pips .

So far this week I've made 3 trades - no losses, I took a bit of profit on my long trade, have 93 points open profit and hold no risk, I might be missing something, but that's how I calculate it.

For 15 years I used to run a 'traditional' type business, I worked 6 days per week, employed three people - my annual fixed costs were around £110,000 - I used to make an average of just £45,000 a year, which didn't make sense to me - now I have time to fight in the T2W playground, pick my daughter up from school, go to the gym, weekends off and NO fixed costs, just variable ones, and I manage them well.

 

[x4x]

OK - I get what you are doing. I also understand that the reason 5pips/ticks/pts is irrelevant to you is because of the TF and frequency with which you trade.

One question though - why not just come out of the long at the 1h short signal and then re-initiate the long where you would have covered the short? I am assuming you are using the same position size for the daily and the hourly.

Yeah, same position size - I want to hold my long trade, it's not too often that a daily support level comes into play. If I knew that the price was going to respect 1H resistance, I would have of course closed it. If I had of closed and the price went through, I would have to look for another long entry - which might have cost me more, because I might not get it right on the first attempt, and would have been far more vulnerable.

 

[x4x]

Good for you , but one week is irrelevant in this business , you should check the whole batch IMO .

Been full time trading for over 10 years, so of course I do, how else would I pay the bills!

 

[elitejets]

I am sometimes long and short same market, same time.
I have a long term swing book and I trade a couple of markets short term intra-day also. I will often trade the swings around a long term position, and yes I do realize it makes me effectively flat but psychologically I find it easier to keep my original & better entry positions.
Trading different months in futures is one method.
I often take a view with Brent and US (WTI) crude so will sell rallies in one, buy dips in other and will effectively be long and short oil at the same time.

 

[x4x]

I am sometimes long and short same market, same time.
I have a long term swing book and I trade a couple of markets short term intra-day also. I will often trade the swings around a long term position, and yes I do realize it makes me effectively flat but psychologically I find it easier to keep my original & better entry positions.
Trading different months in futures is one method.
I often take a view with Brent and US (WTI) crude so will sell rallies in one, buy dips in other and will effectively be long and short oil at the same time.

Yes, if it's done for the right reason, at the right time, there's nothing wrong with it - good luck.

 

[robster970]

I am sometimes long and short same market, same time.
I have a long term swing book and I trade a couple of markets short term intra-day also. I will often trade the swings around a long term position, and yes I do realize it makes me effectively flat but psychologically I find it easier to keep my original & better entry positions.
Trading different months in futures is one method.
I often take a view with Brent and US (WTI) crude so will sell rallies in one, buy dips in other and will effectively be long and short oil at the same time.

Welcome back EJ

 

[x4x]

Then after 10 years i'm sure by now you know exactly how much you gave the brokers from your own money just to open a hedging position , i will leave the calculation for you .

Thanks, but it really is no big deal - the balance sheet at the end of the week, month, year is all that counts, not necessarily how we get there.

 

[cablemonster]

Thanks, but it really is no big deal - the balance sheet at the end of the week, month, year is all that counts, not necessarily how we get there.

spot on sir. All that matters is that you are green daily, weekly, monthly, annually etc. Profitable traders are rare so continued good trading to you. :cheesy:

 

[NVP]

I am sometimes long and short same market, same time.
I have a long term swing book and I trade a couple of markets short term intra-day also. I will often trade the swings around a long term position, and yes I do realize it makes me effectively flat but psychologically I find it easier to keep my original & better entry positions.
Trading different months in futures is one method.
I often take a view with Brent and US (WTI) crude so will sell rallies in one, buy dips in other and will effectively be long and short oil at the same time.

Yep - I get the long/short approach and find it perfectly reasonable in certain conditions

so - would any of you guys also be tempted to trade these different TF's in the SAME direction if the signals were flashing ?

N

 

[cablemonster]

so - would any of you guys also be tempted to trade these different TF's in the SAME direction if the signals were flashing ?

N

I cant see any real issue with having say a position trade long on the S&P (holding for weeks) and then for a separate strategy scalp a short holding for minutes. Yeah sure you will be technically flat however if they are different strats you will be monitoring the metrics of each accordingly and temporarily flattening your long positional trade just because you want to short scalp is a ball ache. technically you are crossing the spread again however this is assuming that you crossed the spread in the first place. You may have entered on tactical limit for example. Being long and short 2 highly correlated instrument is of course a totally different ball game.

The only real issue I could see would be if you did it enough such that the spread/transaction/slippage costs started to eat into your edge in that case it wouldn't be a good idea.

At the end of the day it is the green that matters. The amount and consistency of the green.

 

[Rambo35]

yes but its completely pointless and you lose the cost of the spread. Please read the thread and see what we are saying. I just find this asmazing that so many cant see this

I know most say it is pointless to do so, there are other who imply a hedging strategy using the same pair successfully. I was referring to the OP and commented on the possibility to do so, not making a comment on what I think about it.

 

[graydrake]

He is trading the same instrument, on different time frames, at the same time. This is like two people trading the same instrument, on different time frames. One can go long at the same time the other is going short, so both trades are equally valid. x4x is entering each trade with a stop. I can't see anything wrong with what he is doing in this case...unless I am mistaken...

I am not trading different time frames and usually I enter the both positions at the same time. Assume a ticker is trading at 100 and you fell it will be between 95 and 105 at the June expiration. You sell a June bear call spread (105/107) and a June bull put spread (93/95). As long as the ticker stays between 95 and 105 you keep 100% of your premium on the two spreads - regardless if it moves up or moves down - as long as the move is less than 5 points..

I only enter credit positions, for several reasons. The option value decay always works in your favor, you are trading on other peoples money and most importantly the ticker can move against you and you still keep all of your premium.

If this sounds interesting, I am attempting to build a team using a specific credit approach in Trading Systems, High Probability Credit Trades. Take a look.

Drake