Hedge stocks with a prop

Discussion in 'Prop Firms' started by DreamTrader, Feb 3, 2011.

  1. Hello, everyone. I have a question about hedging stocks. I have been paper-trading highly liquid US stocks for a while and I am thinking about join a prop soon because I do not have enough buying power. With my trading strategy, I do need to take a long and short position on the same stock simultaneously from time to time. I contacted a number of prop firms and they told me my only option is to open two accounts.

    I try to avoid two-account option if I can. Are there any trading program (Sterling or Laser) that allows me to hedge stocks (have a long and short position on the same stock simultaneously)? Thank you for everyone’s input and suggestions!
  2. As around for a place you can wash trade...
  3. lol... call the SEC on 555-3123....
  4. sjfan


    Sorry if I'm being dense - but what's the difference between long and short the stock at the same time, and netting the position?

  5. Hello, everyone. I just want to clarify my point a little bit more. Let's say stock ABC may break resistance R. Its current price is around R. I want to take a long and short postion as I believe its price either break over R or fall from R. In other words, I expect the price will move away (either up or down) from R. As the result, I want to take a long and short positon on stock ABC. Hope it explains my point. Thank you for anyone's serious reply.
  6. jrlvnv


    we understand "what" you are saying, we don't understand the "why" you want to do that?
  7. Hello. I expect stock ABC may move away from R big enough (either up or down) so my winner's profit will be bigger than loser's lose. Of course, I understand that it may not happen as its price may be around R until close. I am wondering if any program can let me take a long and short positon on the same stock at the same time so I do not have to create two account? Thanks.
  8. Surdo


    Trade on a simulator account and pretend you were simultaneously Long & Short, you will make more money than your MOOK "strategy"!
  9. I make a concentrated effort to avoid making negative posts or engaging in anything other than being helpful or partaking in constructive discussions. With that said,

    you are either intentionally trolling to get attention, or you are the stupidest person on these boards (which is quite a title to win).
  10. sjfan


    If you initiate both the long position and the short position at the same time and in the same number shares, then your winner's profit will be exactly the same as your loser's losses (less t-costs). So clearly this is not what you mean.

    If you hold more long than short or more short than long depending on your strategy, but initiate at the same time, then holding the difference of the two positions is exactly equivalent to holding a long position + a short position.

    If instead you may open a long and plan to close it when some condition is met, and then at a later time while the long is still open, open a short position to be closed at yet a later time, you still don't need to open 2 *physical* positions. I think this is your case; Is this what you are trying to do?

    Time 0 Open 100 long Net Position = 100
    Time 1 Open 100 short Net Position = 0
    Time 2 Close 100 long Net position = -100
    Time 3 Close 100 short Net Position = 0

    You see in this case you can still do what you want to do in the same account.

    Am I missing something?

    #10     Feb 3, 2011