Can you be long and short at same time?

[tar]

Do you have a stop on both positions? What happens if spread widens dramatically and takes you out of both? What happens if you increase the long and the short until it's massive size, and you reach the same problem of widening spreads? So the broker asks for 0 margin, on two large positions that can be taken out in seconds?

hmmm.

No , margins shouldn't be a problem for the trader , really , you should be able to put the full margin for both setups "position" and "scalping" and with much extra cushion if you cant then don't trade them both or even better don't trade .

 

[Liquid validity]

So to do this, you have to have no stops? Lets add another one to the Con column for long and short at the same time. Still no Pros for this yet.

true.
Although the no stops issue is related to margin, I assume its under those
conditions that tar is asked for no margin, I can't see a broker not asking
for margin when there is trade risk, unless the margin only gets
pulled from account when one stop gets hit...

 

[tar]

Anyway stop or no stop margin is zero . A good trader wont look at this and will have much much more cushion margin or no margin "don't risk more than 1-3%/trade" .
Remember this is not the "hedging" stuff .

 

[Shakone]

No , margins shouldn't be a problem for the trader , really , you should be able to put the full margin for both setups "position" and "scalping" and with much extra cushion if you cant then don't trade them both or even better don't trade .

Sorry tar, I didn't really understand the response.

I'm confused about why a broker would take on risk while asking for 0 margin.

Do you have stops on either the long or the short?

Given that 0 margin is being asked for, how large a position could you potentially put on both long and short? And if you do have stops, what happens in an extreme situation where both long and short are taken out?

 

[Liquid validity]

Anyway stop or no stop margin is zero . A good trader wont look at this and will have much much more cushion margin or no margin "don't risk more than 1-3%/trade" .
Remember this is not the "hedging" stuff .

I just tried this with my IG p1ss about account (only one I can do force open both ways)

EURUSD long / short, no stops £1pp £ 13 margin...

With stops, they are only going to ask for more margin.
What broker do you use that asks for no margin?

 

[tar]

I just tried this with my IG p1ss about account (only one I can do force open both ways)

EURUSD long / short, no stops £1pp £ 13 margin...

Some brokers will ask for a single position margin even if you have double ( long/short ) , and some will ask for zero margin in that case .

 

[tar]

Sorry tar, I didn't really understand the response.

I'm confused about why a broker would take on risk while asking for 0 margin.

Do you have stops on either the long or the short?

Given that 0 margin is being asked for, how large a position could you potentially put on both long and short? And if you do have stops, what happens in an extreme situation where both long and short are taken out?

This discussion is irrelevant , i wasn't asking you to take advantage of the zero margin policy and play big , i just pointed out this information to LV's question re margins while having double positions ( long/short ) , we're losing track here mate , i'm not interested in this policy nor i thought about exploiting it , you cant , anyway add this : some brokers have a "no negative balance" protection .

 

[Liquid validity]

Some brokers will ask for a single position margin even if you have double ( long/short ) , and some will ask for zero margin in that case .

IG's margin on one trade was £65 with no stop.
Which broker doesn't ask for margin?

 

[Liquid validity]

This discussion is irrelevant , i wasn't asking you to take advantage of the zero margin policy and play big , i just pointed out this information to LV's question re margins while having double positions ( long/short ) , we're losing track here mate , i'm not interested in this policy nor i thought about exploiting it , you cant , anyway add this : some brokers have a "no negative balance" protection .

Is it a losing track though, IG certainly don't seem to think its risk free,
or else they wouldn't ask for any margin, and thats with no stops...

They have to have margin in place by default, rollover balls up (unlikely true) - only one trade open,
or one stop gets hit, they want margin already down.

 

[Shakone]

This discussion is irrelevant , i wasn't asking you to take advantage of the zero margin policy and play big , i just pointed out this information to LV's question re margins while having double positions ( long/short ) , we're losing track here mate , i'm not interested in this policy nor i thought about exploiting it , you cant , anyway add this : some brokers have a "no negative balance" protection .

I find brokers that guarantee a no negative balance quite hard to believe too. I know that some claim to. I would guess that those that do either don't understand what they are doing, are bucketshops, take out options for example to cover fast moves (unlikely), or have it in the small print that they'll cover the loss up to some point, but can't guarantee.

Then again I could be wrong.

 

[cablemonster]

Will the last one out please turn off the lights.

 

[Liquid validity]

Will the last one out please turn off the lights.

won't be me, I'm off in 10

 

[tar]

IG's margin on one trade was £65 with no stop.
Which broker doesn't ask for margin?

IBFX AU doesn't ask for a margin for double positions and i recall some of these MT4 brokers don't ask either , FXCM asks for a margin for just a single position ( although in the demo they didn't ask for a margin for long/short ) , and FXCM is the one with the debit balance protection guarantee :

Is there a debit balance risk? Can I lose more money than I deposit?
Not with FXCM. It is FXCM's policy to credit accounts to a zero balance when debit balances occur as a result of trading.
One of the greatest concerns traders have about leverage is that a sizable loss could result in owing money to their broker. At FXCM, your maximum risk of loss is limited by the amount in your account. All accounts are tracked by our "Margin Watcher" feature. With the Margin Watcher feature, if account equity falls below margin requirements, the FXCM Trading Station will trigger an order to close all open positions.

 

[tar]

FYI : Not that it matters but apparently FXCM changed its policy late last year because of the same issues mentioned by Shakone here , and indeed they didn't ask for a margin for hedged positions in the past , anyway now they ask for 50% only ( one leg ) :

FXCM Makes Margin Changes to Hedged Positions | Forex Magnates

 

[barjon]

.........................Trader A: 31X + Unknown P&L from 31 additional trades

or

Trader B: 31X + Unknown P&L from up to 31 additional trades.

I hope everyone can see that, because we can't know what the P&L of their trades is going to be before they've happened, we should always choose Trader B.................................

I tell you what, HM, why don't we set it up? I'll be Trader A and you Trader B and we'll do 31 trades.

Every morning we'll take ftse open and when it's moved 30 points or more either way we'll assume you took that trade and you can tell me when you'd close it - I'll then go flat by taking the opposing position at the same price.

I'll then tell you when I close one of the legs and you say whether you would take an outright at the same price of my remaining leg. If you do we'll assume an identical result (it's not a contest as to who manages that trade best) and it'll be a draw since our costs will be the same at 2 round trips each.

If you don't choose to take a trade I'll start with -1 point (round trip cost with a 1 point spread) because of my extra trade. To try and take as much "skill" element out of it as far as possible I'll just set and trail a 3 point stop.

Probably be a logistical nightmare - we'd both need to be about and probably have to do it via skype messenger or something.

 

[tar]

Unsubscribed !

 

[cablemonster]

Staggering.

 

[barjon]

Staggering.

what is?

 

[cablemonster]

what is?

A drunken man coming out of the pub.

 

[Hakuna Matata]

I tell you what, HM, why don't we set it up? I'll be Trader A and you Trader B and we'll do 31 trades.

Every morning we'll take ftse open and when it's moved 30 points or more either way we'll assume you took that trade and you can tell me when you'd close it - I'll then go flat by taking the opposing position at the same price.

I'll then tell you when I close one of the legs and you say whether you would take an outright at the same price of my remaining leg. If you do we'll assume an identical result (it's not a contest as to who manages that trade best) and it'll be a draw since our costs will be the same at 2 round trips each.

If you don't choose to take a trade I'll start with -1 point (round trip cost with a 1 point spread) because of my extra trade. To try and take as much "skill" element out of it as far as possible I'll just set and trail a 3 point stop.

Probably be a logistical nightmare - we'd both need to be about and probably have to do it via skype messenger or something.

Before we do that, why don't you explain how you would interpret the the results, and what they would mean...