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That is the only reason for it, but that is something entirely different where there is two strategies or two EAs and that is not called "nedging".
For a single strategy or single EA, there is ABSOLUTELY no reason to "nedge", not even for operational reasons. A stop-loss or take-profit on an existing position is equivalent to an indirect pending stop order. You can easily use pending orders instead of "nedged" positions and will save you on trading costs (spread, commission and swaps). For EAS, there is also no need to use pending orders (most of the time, except for specific situations) — just monitor the price quotes and react accordingly with market orders.
No matter how you look at it, be it from a trading perspective, a mathematical perspective or an operational perspective, "nedging" ALWAYS comes out at a disadvantage. Adjust your mind-set, look at over it again with a fresh perspective, and you will ALWAYS find it better and easier to use the direct approach.
"Nedging" is BAD, plain and simple! And, no I am not being dogmatic! Just over-stating the obvious, to get the point across.
EDIT: There is also one other situation where a temporary "nedge" is helpful, and that is to "freeze" gains when implementing a "Close By" of multiple open positions in the same direction, but that only lasts a moment and does not increase trading costs. It is also something different and not considered "nedging".
Again, operational advantages I can see to that, some I mentioned, there are some more.
One use can be to protect a position against a weekend gap, in the premiese that most gaps are closed during the week, and that way you can avoid risking margin calls when a large gap comes against your position, and once the gap is closed you just close the protective part and go on.
Although you can close the position and open a new one, but that will be at a worse price and the p&l of that position will not be correct- so psychologically if you trade manually and money management view if you trade automatically is a difference.
There are some more operational reasons, I don't use names like negding and of course it's not real hedging but still, it has some operational uses, not necesserily the ones intended in the openning post but there are.
Again your example can easily be resolved with a direct approach — just close the position out before the weekend. You will save on swaps as well.
Then when the "virtual gap" is closed, you place the order again. Your trading cost will still be lower than the "nedged" solution. The "nedge" will not save you nor reduce you costs or improve your P&L, or drawdown or margin requirements. Your reasoning is flawed. Do the maths and you will see.
But, I am not your judge. If you want to trade that way, it is up to you. Just take the time to do that maths and calculate things.
Again your example can easily be resolved with a direct approach — just close the position out before the weekend. You will save on swaps as well.
Then when the "virtual gap" is closed, you place the order again. Your trading cost will still be lower than the "nedged" solution. The "nedge" will not save you nor reduce you costs or improve your P&L, or drawdown or margin requirements. Your reasoning is flawed. Do the maths and you will see.
But, I am not your judge. If you want to trade that way, it is up to you. Just take the time to do that maths and calculate things.
Yes, I do use both "netting" and "hedging" accounts. For most of my strategies, I prefer "netting" accounts for simpler operations and my EA code is also more efficient that way.
Yes, I do use both "netting" and "hedging" accounts. For most of my strategies, I prefer "netting" accounts for simpler operations and my EA code is also more efficient that way.
Correct! I do use strategies where the analysis is multi-time-frame but not the trading.
EDIT: To be honest I have yet to see any real advantage in dividing up my trading equity between strategies operating on different time-frames on the same symbol. I usually get better returns using only one strategy per symbol.
Correct! I do use strategies where the analysis is multi-time-frame but not the trading.
EDIT: To be honest I have yet to see any real advantage in dividing up my trading equity between strategies operating on different time-frames on the same symbol. I usually get better returns using only one strategy per symbol.
If a strategy takes decisions based upon analysis of a timeframe, and it has a tp/sl based on that, then it's easy to see that a different timeframe might have opposite direction target - shorter or longer - and they are both valid as they are the same strategy
I understand your point. I am just saying that if I invest 0.5% on each of two strategies on the same symbol, I usually get better returns if I just use the whole 1% on the best of the two strategies.
Since my strategy is already multi-time-frame in analysis, it is already choosing the better overall option to invest the whole 1% instead of splitting it between two strategies operating on separate time-frames.
That is just my own opinion based on my experience so far.
Im looking for more alternatives to no SL strategys.
Here a few examples of no SL strategys / trade management: grid, martingale, zone recovery or hedging.
Im looking for more ideas or examples, smarter aporoaches wich have less risk.
I appreciate any idea, the goal is to comapre them all and See what statisticly makes the most sense (best odds)
Doest matter how crazy the idea seems, i would appreciate any Alternative or modifyed Version of the once i mentioned.
Not sure what you all are talking about or what EA´s you are using!?
I use my own ones which are dealing with a commission markup of 15$ per Standardlot beside the ECN spreads and earning me rebates like crazy... For almost 3 years now - it definitely works, this is what I can tell you! 0.5 to 1.5% as trading profit a month as trading profit is enough when your account is big enough and you additionally earn 80% of the commission markup, haha. Be creative, register as an affiliate at a broker and let your wife (brother, sister, oncle, whatever) open an account with your affiliate link and get commissions, you can do it vice versa too at most brokers, do this at a few brokers and you can do a VERY good living out of being "break even".