ForEx operators, 1 or many?

Question

In order to make a more stable investment it better to have many Forex operators in different brokers and spread the money among them or just one?

Answer 1

You mean hedging your positions in different accounts? Some people do that, others think it hamstrings their profits. If you want to hedge, try different trading methods, instead of just opening a long position with one account then shorting with another.

The primary methods of hedging currency trades for the retail forex trader is through spot contracts and foreign currency options. Spot contracts are the run-of-the-mill trades made by retail forex traders. Because spot contracts have a very short-term delivery date (two days), they are not the most effective currency hedging vehicle. In fact, regular spot contracts are usually the reason why a hedge is needed.

Foreign currency options are one of the most popular methods of currency hedging. As with options on other types of securities, foreign currency options give the purchaser the right, but not the obligation, to buy or sell the currency pair at a particular exchange rate at some time in the future. Regular options strategies can be employed, such as long straddles, long strangles, and bull or bear spreads, to limit the loss potential of a given trade.

Not all retail forex brokers allow for hedging within their platforms. Be sure to research the broker you use before beginning to trade. (http://www.investopedia.com/terms/forex/...

Speculating is not investing. There is always the risk of losing money. It's part of doing business.

Good luck!

http://jsforex.blogspot.com

Managed Accounts in Forex Trading

Answer 2

It does not matter the broker. I would try to use traders though if you are doing managed forex accounts. If you are doing it yourself, it doesn't matter.