hedging pairs

Hi Dears .

which pairs now i can hedge ?

The process of hedging involves a single currency pair or two different currency pairs that have a common base currency. Some traders also use correlation to find different currency pairs with positive or negative correlation with each other, and then enters a buy or sell position according to their market analysis. So it's up to you what to do.

This is also one of the options in order to secure your trade.

This is the basic hedging procedure on the market:
Buying Euro - EUR/USD
Sale of Swiss franc dollar - USD/CHF
These two assets have a strong negative correlation, which means that when the euro rises, the Swiss franc falls by the same value, equally.
Thus, if the acquired asset loses value, the trader receives a loss amount due to the position on the second asset, which reacts with the same amplitude.

Depends on the conditions of the market, but EUR is usually good one to hedge

In any case, it is best to focus on how the market behaves.

WaleedYKammel posted:
Hi Dears .

which pairs now i can hedge ?

You can hedge any apir

i think USD always volatile currency pair than others , sometime you can get profit by means of this pair but most of the time its difficult to predict the real faction of this currency with certainly. 

It’s very much dependent on market conditions. But generally speaking, major currencies like USD, GBP and EUR are good ones to hedge.

Shalinara posted:
This is the basic hedging procedure on the market:
Buying Euro - EUR/USD
Sale of Swiss franc dollar - USD/CHF
These two assets have a strong negative correlation, which means that when the euro rises, the Swiss franc falls by the same value, equally.
Thus, if the acquired asset loses value, the trader receives a loss amount due to the position on the second asset, which reacts with the same amplitude.

That would sometime work but sometimes not
see https://www.myfxbook.com/forex-market/correlation/USDCHF-EURUSD

Hedging is the most dangerous trading strategy if you don't have any knowledge about it. So, gather proper knowledge, before using hedging on your trading.

ElliotCooke posted:
Hedging is the most dangerous trading strategy if you don't have any knowledge about it. So, gather proper knowledge, before using hedging on your trading.

Yes, I agree with you. Not learning hedging strategies can be detrimental to investment.

What is hedging pairs, and why do some traders say it is dangerous to use them?

Shalinara posted:
This is the basic hedging procedure on the market:
Buying Euro - EUR/USD
Sale of Swiss franc dollar - USD/CHF
These two assets have a strong negative correlation, which means that when the euro rises, the Swiss franc falls by the same value, equally.
Thus, if the acquired asset loses value, the trader receives a loss amount due to the position on the second asset, which reacts with the same amplitude.

Do you have a particular reason to choose this pair or this is just an example? Do all the pair with same base currency have a negative correlation?

ElliotCooke posted:
Hedging is the most dangerous trading strategy if you don't have any knowledge about it. So, gather proper knowledge, before using hedging on your trading.

I agree with you.

New traders should try it in major pairs.

It is a kind of strategy to minimize the risk.

WaleedYKammel posted:
Hi Dears .

which pairs now i can hedge ?

EUR. is normally good to hedge