What is a good way to hedge currency risk?

Discussion in 'Interactive Brokers' started by solidme, Nov 27, 2020.

  1. solidme

    solidme

    The options are a lot and it is quite difficult to understand the implication of all. it is matter of getting used to different tools and solution. I will make some test on the paper trading account and if cost are similar I will go for the simpler solution
     
    #31     Nov 29, 2020
  2. solidme

    solidme

    I've made a little test in sym: I've converted all my funds in USD, open a stock position grater than my funds (+-10%) and tried to see difference when hedging with the Future or Virtual FX

    So far I noticed:

    Costs:
    - Future: buying 1 contract of M6E @MKT cost 0.33 EUR
    - VFX: Commission on Virtual FX 12k (odd lot) @MKT 2.5 EUR

    Account balances:
    - Future: OF you have less Available Funds, and higher Marign
    - Virtual FX : you have more funds but you have a negative USD total cash (I guess on that you have to pay margin loan ???)
     
    #32     Nov 30, 2020
  3. Yes.
     
    #33     Dec 1, 2020
    solidme likes this.