Being both long and short at same time

Discussion in 'Options' started by qlai, Jan 23, 2019.

  1. qlai


    In below podcast (around minute 22), the guy describes how he has two separate accounts to be able to be both long and short at the same time. Is this something that you are not supposed to do but individual FCMs don't have responsibility to check?

    What's the rationale for this kind of set up? This must work great in a range and the opposite side protects you if the range is violently broken in either direction?

  2. Don`t forget the sideways
  3. Robert Morse

    Robert Morse Sponsor

    There is no reason to ever be long/short a future in two accounts on purpose, as a strategy.
    Pekelo, piezoe and dealmaker like this.
  4. Stacking strategies is what the ML world calls it. Can be done in institutional account, which allows segregating accounts/strategies
  5. Robert Morse

    Robert Morse Sponsor

  6. Sounds about like betting Pass/Don't Pass at the same time. You still lose because of vig (12s)... :D
  7. Machine Learning maybe?
  8. speedo


    Not something I'd do but one could get a long signal on one time frame and a short signal on another. Nothing wrong with it as long as the signals were valid and rules of the trade kept.
  9. qlai


    I think this maybe what digitalnomad means by stacking, but I was thinking in terms of scalping ranges. Let's say you start getting long near the bottom of the range. You keep buying some at every level expecting a snap back. This technique requires many contracts - the more the better. Most of the time you will churn most of your contracts booking profits while having open losses on the other side and vise versa. Rinse and repeat. But what if the range breaks violently and never comes back? You would be caught with lots of contracts. However, if you have an offsetting short position, you are hedged. Simply close both positions and look for another range to scalp.
  10. Robert Morse

    Robert Morse Sponsor

    Why would I be long/short 5 futures at two different FCMs or in two accounts when I can be be flat? Makes no sense.
    #10     Jan 23, 2019