Forex hedging journal

P

pbw

Please contribute your ideas and thoughts on hedging Forex -or any experience you have in this area.

Right now I see Gbp/USD at good support moving up -- buy at 1.9623
and sell Eur/USD at 1.4826.

I am new at hedging. Cheers.
 
There have been a few threads about hedging that are pretty entertaining to read. If you are a trader hedging seems pointless. If you a longer term investor or have a strong general sentiment about something playing out but you're not sure when hedging seems to have its merits. Don't use hedging as a way to escape taking loses. If you think the GBP/USD is going to 2 in 5 days just buy it if you think it is going to 2 sometime in the next 3-6 months then short something with a strong correlation. But then again strong correlations don't always last forever. For my long term plays I use one of those bucket shops that let you go both ways and depending on what mood im in I'll either have a long bias or a short bias, it seems ok as long as you don't mind paying premiums out the a** until your trade plays out.
 
Also please stay on topic -- if you are selling eur/gbp at 7550 -- what are you hedging it against -- cheers.
 
-open- GBP/USD = buy -1.9623
-present -GBP/USD = 1.9676 = +53 pips


open - EUR/USD = sell - 1.4826
-present -EUR/USD = 1.4829 = -3 pips=

profit = + 50 pips
 
Like the previous poster said - you can as well trade eur/gbp - and NOT pay 2 spreads each time. Whatever you are doing, its not 'heding'.
 
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