Broker for 'hedging' futures

[CaduceusRising]

Hi All

Yes, I know you can't hedge a future long and short simultaneously, as it's a zero sum gain on the trades and you just end up losing broker fees on both trades...

However... is there a broker that will let you create two accounts to do such a horrific thing? Or, could it be done on two brokers simultaneously, before the market opens, so both trades start the day on the same price?

Asking for a friend obviously :-|

 

[Overnight]

Hi All

Yes, I know you can't hedge a future long and short simultaneously, as it's a zero sum gain on the trades and you just end up losing broker fees on both trades...

However... is there a broker that will let you create two accounts to do such a horrific thing? Or, could it be done on two brokers simultaneously, before the market opens, so both trades start the day on the same price?

Asking for a friend obviously :-|

Any futures broker in the universe will allow it. But it is up to you to know what the heck yer doing with it. The CME is specifically ambiguous on the purpose of such a long/short hedge on same instrument on same account(s) with beneficial ownership, ASIDE FROM KNOWINGLY ATTEMPTING TO AVOID BONA FIDE MARKET RISK. The devil is in the details.

 

[eastern_warrior]

You can’t trade with yourself, not allowed.

 

[Robert Morse]

Hi All

Yes, I know you can't hedge a future long and short simultaneously, as it's a zero sum gain on the trades and you just end up losing broker fees on both trades...

However... is there a broker that will let you create two accounts to do such a horrific thing? Or, could it be done on two brokers simultaneously, before the market opens, so both trades start the day on the same price?

Asking for a friend obviously :-|

This topic has come up before, and that time for a friend too. There is no reason to ever do this. What is the point of this boxed position?

Concurrent Long and Short Positions
https://www.cmegroup.com/tools-information/lookups/advisories/market-regulation/files/SER-7613v3.pdf

 

[CaduceusRising]

Any futures broker in the universe will allow it. But it is up to you to know what the heck yer doing with it. The CME is specifically ambiguous on the purpose of such a long/short hedge on same instrument on same account(s) with beneficial ownership, ASIDE FROM KNOWINGLY ATTEMPTING TO AVOID BONA FIDE MARKET RISK. The devil is in the details.

Yer, I'm with AmpFutures, and they stated to me they do not support Hedging, it's the reason I ask Mr Night... I'm presuming it would have to be arranged on two brokers then... which I am presuming means a challenge with setting them running simultaneously even with a bot trade.

 

[CaduceusRising]

This topic has come up before, and that time for a friend too. There is no reason to ever do this. What is the point of this boxed position?

Concurrent Long and Short Positions
https://www.cmegroup.com/tools-information/lookups/advisories/market-regulation/files/SER-7613v3.pdf

Thanks Robert (Rob, Bob... whatever your preference) this link is very useful great link to the regs'.

 

[MattZ]

"hedging" is a term invented by the forex industry to make anyone feel as if he did not lose yet, and "locked" his loss. It's just near impossible to untangle. Simultaneous open and close never helped a trader. It should not be called hedging...should be called a headache.

 

[CaduceusRising]

"hedging" is a term invented by the forex industry to make anyone feel as if he did not lose yet, and "locked" his loss. It's just near impossible to untangle. Simultaneous open and close never helped a trader. It should not be called hedging...should be called a headache.

That's a good point; my theory isn't really hedging, it's just two separate positions.

The Optimus news service looks really interesting Matt - I'm looking for an application that will clear out the substantial amount of 'noise' from all the news services. Is it really free

 

[Robert Morse]

Thanks Robert (Rob, Bob... whatever your preference) this link is very useful great link to the regs'.

Either is fine. I try to use"Bob" at Lightspeed as we have another Robert that uses "Rob". I still do not see the advantage to what I call a boxed positions and the CME refers to as “Concurrent," as a strategy. If you live in the US, the IRS treats 1256 contracts, which all futures are, as a product that gets Market To Market accounting at end of year, There is no realized vs unrealized P/L. There are all the same.

The only circumstance where I can see doing this is when you have a second trading account and the other crashes and you need to unwind a trade in the second account. And, based on what I posted, I'm not sure that is allowed, so I'm not suggesting that.

 

[MattZ]

That's a good point; my theory isn't really hedging, it's just two separate positions.

The Optimus news service looks really interesting Matt - I'm looking for an application that will clear out the substantial amount of 'noise' from all the news services. Is it really free

Yes, it is free for Optimus customers. If you are looking for daily news announcements filtered by country, and markets, this application could save you a lot of time filtering news. Here are the videos for OptimusNews: OptimusNews There is a component where you can get historical testing of signals, and that is not free. However, if you are just looking for a good web-based news app, it is clean, easy to use and free.