Can I long and short simultaneously ?

Why would you want to temporary freeze the drawdown?
What difference does it make?

Could make sense for margin, psychological or taxes reason... Or if you want to take a short term trade against your long term positions, otherwise technically I see no advantage.

 

Yes, that would be a good reason, a short against a long.

 

It is a zerosum game with the share holding.

You can be flat, long or short. Total net of position is what counts at the end of the day.

 

@KCalhoun This doesn't make much sense since a covered bearish trade can't report a net loss of zero. You may be able to do a revenge act by blowing the true story to IRS. No harm done morrly since you are helping the country identify tax evaders.

 

Only for profits. Taxes have their own view.

 

Talk to tda customer support. Apparently they need to enable this facility since it is not a defacto ability on all accounts but what happens between you and IRS is a complicated item you need to be mindful.

 

Let's be perfectly clear here, there is absolutely no difference from a trading profit perspective from one simultaneously holding an identical long and short position and simply selling the long position, except that you'll end up paying more in commissions and spread. Please feel free to provide any example you care to and I can demonstrate this. It's a common newbie fallacy that can easily be dispelled by thinking through it.

The only legitimate reason for doing this would be if you lived in a jurisdiction where it could lead to favorable tax treatment, typically for ensuring a long term capital gain. This doesn't work in the U.S. So if you're in the U.S., doing this is not only pointless but stupid.

 

I don’t know if this makes sense or it’s purely psychological, but I often “hedge” a underwater position in a separate account. This is mostly when I fear overnight gap. In my mind, I am buying a protective option with no theta decay. I often get out of this hedge with a profit. Does this make any sense to you?

 

It makes sense that you would feel that way. But if you work through it methodically it actually doesn't make any sense in reality. This is one of those places where our intuition let's us down.

 

Of course you can. Just do it with 2 different accounts.