Hedging is a common trading strategy used by forex traders, but what are the basic aspects that brokers need to consider when hedging?？Learn more in this article。

The number of forex brokers in the world is increasing and choosing a broker is not easy because not all brokers can meet the needs of every trader, one of the best ways is to pay attention to the trading strategy you use。As a trader, it is most appropriate to find a broker that offers the most profitable Forex trading conditions and supports your strategy。

One of these strategies is called hedging and is usually done by opening at least two opposing positions。The purpose of hedging is to balance a losing position with another position。There are many ways to hedge, namely, the same currency pair hedging, different currency pair hedging, multi-asset hedging, etc.。Each trader usually has their own preferences。

If you prefer to use hedging strategies, here are some recommended brokers:

1. IC Markets: well regulated, with original spread accounts, allowing hedging on the MT5 platform
   FBS: Highly diversified features and trading conditions
   Exness: Known for instant withdrawals and execution reliability
   Pepperstone: Breakthrough on Razor account
   OctaFX: ECN-like conditions with affordable transaction costs

How each of the above brokers can provide the best hedging environment？Let's discuss。

1. IC Markets

IC Markets is a global ECN broker known for being the ideal broker for a variety of trading strategies, including hedging practices。The broker has a minimum deposit of $200, offers a relatively low spread (from 0 points) and a commission of only $3 per lot.。In addition, IC Markets offers no overnight interest accounts。

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IC Markets is a private company in International Capital Markets Pty Ltd..) an online forex brokerage company operated under。Traders under Australian jurisdiction offer trading services at IC Markets-AU, which is based in Australia and licensed by the Australian Securities and Investments Commission (ASIC).。

On the other hand, non-Australian traders who open accounts with the broker are under the Seychelles-basedIC Markets SEY registered and regulated by the Seychelles Financial Services Authority (SFSA)。This dual operation is the result of the Australian Securities and Investments Commission's relatively new rules, which prohibit its regulated brokers from providing trading services outside Australia.。

IC Markets is classified as an ECN broker offering clients MetaTrader 4, MetaTrader 5 and cTrader as platform trading options。The broker also follows market trends with cryptocurrencies as one of its products, enriching its already wide selection of trading assets, including currencies, indices, metals, energy, software, stocks and bonds.。

with other affectedThe minimum deposit for IC Markets is at a moderate level compared to ASIC-regulated brokers, as each customer has a deposit of $200。Market analysis materials are also regularly prepared for trading insights on the official website of IC Markets, proving their ability to provide traders with important content created specifically for the market experts they work for.。

For payment methods,IC Markets allows financing and withdrawals via wire transfers, credit cards, PayPal, Skrill, Neteller, FasaPay, UnionPay, and BitPay's Bitcoin。The more interesting aspect of the broker is its multiple base currencies, including the US dollar, Australian dollar, euro, British pound, Singapore dollar, New Zealand dollar, Japanese yen, Swiss franc, Hong Kong dollar and Canadian dollar。

因为IC Markets' trading technology is equipped with highly centralized servers and extremely low latency (especially on cTrader), and the broker is well known for its ability to host traders with special needs for high-frequency trading and order brushing。

Anyway,IC Markets is the right destination for active traders looking for well-regulated brokers。IC Markets is also flexible in terms of base currency and payment methods, which demonstrates their commitment to welcoming traders from outside their home countries.。By the end of 2019, IC Markets was offering websites in 18 international languages, including English, Korean, Indonesian, French, Spanish, Italian, Malay, German and Chinese.。

2. FBS

FBS Broker is one of the globally recognized brokers with multiple hedging advantages。With a minimum deposit of $1, you can start trading and enjoy a low spread from 0 points。It should be noted that the minimum spread varies from account to account。For hedging purposes, it is best to trade with the lowest possible spread, as more than one order will be charged each time you hedge。

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Since 2009, FBS Holding Inc.(FBS) achievements in the field of foreign exchange transactions have been recognized by various international institutions.。As of 2019, the number of FBS clients reached 14 million, winning the most transparent Forex broker in 2018, the best investor education in 2017, the best customer service broker in Asia in 2016, the IB Forex program and many other titles.。

FBS is regulated by Belize IFSC and Cyprus CySEC。The broker is trusted by millions of traders and 370,000 partners from all countries.。According to the data, FBS has about 7,000 new trader and partner accounts every day.。And, 80% of customers will stay in FBS for a long time。

Trading products offered by FBS include Forex, CFD, Precious Metals and Equities。For Forex trading, CySEC-regulated FBS provides leverage of up to 1: 30 for cent accounts and standard accounts。Customers who want to try higher leverage can also register an account with FBS Belize。

In all types of accounts, the spread is from 1 point。Volume orders in standard accounts can be 0.01 to 500 lots, it is recommended that experienced traders use the account。

And on the cent account, bulk orders can be executed up to $500 breakups or the equivalent of 5 standard lots.。Cent accounts involve varying degrees of risk。FBS recommends cent accounts to beginners。All account types support the following trading instruments: 28 currency pairs and 2 metals。

Before entering the real Forex market, traders can practice using the FBS demo account, which is divided into two types, namely standard account and cent account。

Using the MetaTrader 4 and MetaTrader 5 platforms, FBS provides services on Windows and Mac, as well as Android and iOS mobile devices, providing traders with a trading experience at their fingertips, allowing traders to trade anytime, anywhere。

The MetaTrader platform also has a variety of key features, including the creation, purchase and use of Expert Advisors (EA) and scripts, one-click trading and embedded news, technical analysis tools, documentary other traders, hedging positions and VPS service support。

Another advantage of FBS is that customers who meet specific requirements receive a 100% deposit bonus and the deposit and withdrawal process is fast and convenient.。According to the customer, in addition to holidays, usually no more than 3-4 hours。

In order to increase the security of client funds, FBS also offers segregated accounts where 70 per cent of funds can be deposited with the client's bank; in addition, the margin is between 10 and 100 per cent.。If the trader loses funds in the course of trading but is insured, FBS will refund the trader's funds。

Traders have the opportunity to develop a side business when trading with FBS, i.e. as an economically recommended (IB) or affiliate。The commission provided by the FBS partner system is already at level 3, and traders can only earn additional income if they introduce new customers to FBS according to certain procedures。

Traders will also gain trading education experience at FBS。They have prepared a comprehensive foreign exchange course divided into 4 levels: beginner, beginner, intermediate and advanced。Traders can take courses that transform them from novice to professional, all materials are well structured。In addition, FBS offers a variety of forex analysis, webinars, forex news and daily market analysis that can be easily accessed on its website。

Traders can visit the official FBS website, which is available in multiple languages, including English, Dutch, Italian, French, Portuguese, Indonesian, Spanish, etc., and also provides live chat support 24 hours a day, 7 days a week。

In summary, FBS is a well-known broker among global retail traders。Due to flexible trading conditions, customers are able to use a variety of instruments for trading, low deposits, etc.。

3. Exness

Exness is a reputable broker that allows its clients to hedge。The broker's spread is as low as 0.1 point, support for hedging on MetaTrader 4 and 5 platforms。In fact, Exness is known for its focus on providing the truly important services to its clients "trading activities without providing too many side services such as bonuses and promotions.。

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The choice of broker is adjusted according to the needs of each trader. If you only need the basic platform and trading functions with the best attributes, then Exness may be your best choice。

Exness with its 0 only.Advantages such as the low spread from 1 o'clock make up for the lack of changes in its functions, which is very suitable for traders using scalping strategies (Scalper)。Spreads for major currency pairs in some account types can also be as low as 0.0 point, depending on market conditions。

Not only that, traders can also enjoy other advantages such as automatic withdrawals。Exness will process most customer withdrawals immediately without manual inspection; however, depending on the payment provider or method selected, withdrawals may be restricted。

Exness is one of the STP / ECN brokers in Europe, and the safety of traders' funds is also guaranteed。Exness became the official partner of Real Madrid football team for 3 years from July 2017, which also proves that the company has a high degree of stability.。

Exness supports deposits and withdrawals 24 hours a day, 7 days a week。However, it should be noted that the Company does not assume any responsibility if there is a problem with the deposit or withdrawal due to the payment system.。

Traders don't need to worry about transaction fees when making deposits and withdrawals.。Exness does not charge traders any transaction fees, and the chosen payment provider may incur some fees。Exness offers traders a variety of payment methods, including wire transfers, bank cards, Neteller, Skrill and more。

Financial reports and metrics on the Exness website are audited quarterly by Deloitte, one of the world's top four accounting firms。

In addition, Exness is one of the most transparent brokers in the online trading industry, and traders can find all the information about the company on the website, such as trading volume, number of active customers, customer deposits, company funds, etc.。

Exness offers different platforms, including MetaTrader 4, MetaTrader 5, web and mobile platforms。This makes it easier for traders to trade on Exness because they can also access the Exness platform anytime, anywhere.。

Over the years, Exness has developed into a broker that attracts traders, who comply with financial regulations such as FCA and CySEC, further strengthening their trust.。

One measure of customer confidence is the volume of transactions。As of December 2018, the monthly trading volume of its clients reached $348.4 billion, with more than 50,342 active traders worldwide.。

With the programs offered by Exness, traders also have the opportunity to earn extra income by becoming their partner。By introducing the Broker (IB) program, partners can earn up to 33% spread commission from each new customer who registers。

Additional income from Exness Partners。Traders who register through the member link can earn up to 25% spread commission per trade.。

Customers can also use their free VPS hosting service when trading at Exness。VPS (Virtual Private Server) provides traders with greater reliability and stability because they can maintain their trading and expert advisors without interruption in the event of unexpected technical problems (such as Internet or power outages)。

In summary, Exness is a trader's favorite broker due to its low spreads and flexible account type, ideal for traders with limited funds but need more opportunities to maximize profits。The broker is also known for its maximum support for new and old partners.。

4. Pepperstone

Like the aforementioned brokers, Pepperstone is known for supporting a variety of trading strategies。The broker makes it clear that any hedging user can use them。There are 61 currency pairs to choose from, while enjoying a low spread from 0 and 2 per lot..Low commission of $50, trading platforms offered are MetaTrader and cTrader。

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Founded in 2010 by a team of experienced traders working together to improve online trading, Pepperstone is based in Melbourne, Australia and has grown into one of the world's largest forex brokers.。If a trader wants to find a broker that offers low spreads, fast execution and award-winning support, the answer is Pepperstone。

Pepperstone has strong legal safeguards as it is licensed by Australian regulators ASIC and FCA.。Traders "funds can be deposited into separate accounts at Australia's top banks, one of which is National Australia Bank (NAB).。Therefore, if a trader chooses to open an account in Pepperstone, the safety of funds is not an issue。

They successfully partnered with 23 top banks to bring bids to investors instantly via fiber optics, which enabled all orders to be executed 100% automatically with delays as low as zero..05 milliseconds, no need for trading desk intervention and re-quotation, and ultra-low transaction costs。

Pepperstone is trusted by more than 73,000 traders worldwide, processing an average of 125 per day..$500 million in trading volume and won awards for such things as:

Best Forex ECN Broker and Best Forex Trading Support Worldwide 2019 (Europe)
Best Australian Broker and Best Trading Platform 2018 by Compare Forex Brokers
2018 UK Forex Awards Best Forex ECN Broker, Best Forex Trading Support and Best Forex Trading Conditions

With numerous awards, Pepperstone attracts more and more traders from all over the world。Pepperstone's performance rose not only because of its ultra-low spreads and fast execution services, but also because many traders were keen to trade in currencies other than the US dollar.。

As a result, Pepperstone is one of the most responsive brokers to the market because it is willing to accept deposits in 10 currencies, including the Australian dollar, the US dollar, the euro, the Canadian dollar, the British pound, the Swiss franc, the Japanese yen, the New Zealand dollar, the Singapore dollar and the Hong Kong dollar.。

Pepperstone allows traders to choose between 11 trading platforms: MT4 Desktop, MT4 Mac, MT4 iPhone, MT4 Android, MT4 iPad / Tablet, MT5, WebTrader, cTrader WebTrader, cTrader cAlgo and cTrader Mobile。The choice of trading platform is very practical for novices because it executes quickly。

When trading Forex, traders can enjoy 0 on their Razor account.0 pip original spread, over 61 currency pairs, and commission-free account funds for various deposit options。In addition to currency pairs, Pepperstone offers several types of trading tools, including indices and stocks, commodities and cryptocurrency CFD。

Commodity trading tools are very diverse, not only metals, gold and silver, but also soft commodities such as cotton, sugar, coffee, cocoa and orange juice.。Pepperstone also offers energy (oil and gas) trading.。

Pepperstone offers two types of accounts, Razor accounts and Standard accounts。If you are a beginner, it is recommended to choose a EUR / USD average spread of 1.0-1.3 point and commission-free standard account。

Traders with specific trading styles (such as scalping traders and algorithmic traders) may enjoy the traditionally lower-cost setup of Razor accounts, with a trading commission of 7 Australian dollars and a trade of 100,000 US dollars per round..01 (micro) and 1: 400 leverage to start trading。

As Pepperstone customers, traders can deposit and withdraw money through Visa, Mastercard, POLi Internet Banking, Bank Transfer, BPay, PayPal, Neteller, Skrill and Union Pay。

If you are new to trading or want to practice your trading skills in a risk-free environment, you can create a demo account, but if you are experienced or prefer to learn by doing, Pepperstone offers live accounts that allow you to trade with real-time execution and pricing.。

Traders can also use third-party services to follow popular trader scenarios while learning how to improve their trading abilities。Pepperstone works with a range of social trading platforms for traders to choose from, such as Myfxbook, ZuluTrade, Mirror Trader, MetaTrader Signals and Duplitrade。

5. OctaFX

OctaFX is a well-known broker, especially in the Asia Pacific region, and here is their official statement on hedging:

allow scalping, hedging and other strategies if the order is placed under our customer agreement。Note, however, that carry trades are not allowed。

To support hedging users, brokers offer fairly low spreads from 0.From 2 o'clock, no commission, minimum deposit amount is $100。Not only that, OctaFX also provides some useful tools, such as the automatic trading function of MetaTrader 4, and allows the use of expert advisors。

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OctaFX is one of the most famous brokers in the world and has won many awards for its very comfortable trading atmosphere and close-to-client service。OctaFX was founded in 2011 and is headquartered in Nicosia Strovolou 47, Kyros Tower。

OctaFX has received authoritative awards including "Best ECN / STP 2019" and "Best Broker in Asia 2019" from FX Daily Info; the Best Broker in Asia 2018 from Global Banking and Finance Review Magazine; and the Best Forex Broker and Best Trading Conditions 2018 from European CEO Magazine.。

For traders in most countries, OctaFX is licensed by Octa Markets Incorporated and registered in Saint Vincent and the Grenadines.。The broker also offers various facilities, such as live chat in Indonesian and WhatsApp support services, and deposits and withdrawals can be made through various local banks.。OctaFX does not charge a commission for every deposit and withdrawal made by a trader。

OctaFX offers different types of accounts that use market execution (STP / ECN) and 0.Floating spread of 2 points。All accounts of the OctaFX broker allow the use of various forex strategies, including scalping, hedging and trading with an EA。

There is also a fixed exchange rate discount when opening a Micro MT4 account.。All deposits made in IDR will be calculated at the exchange rate of US $1 = Rs 10,000 and will be credited to the trader's account balance。In addition, Muslim traders who want to avoid overnight interest can also use a no overnight interest account。

OctaFX trading is also suitable for novice traders。Because OctaFX offers low spreads, from 0.0 points to start floating, the required initial deposit is also very low, only $25。Account currencies are USD and EUR。

OctaFX gives 50% bonus every time a trader makes a deposit。and OctaFX's opening opportunities increase, deposit bonuses can be withdrawn on terms and conditions。

If traders are still confused about calculating profits, the OctaFX platform provides a trading calculator for each account type, where traders simply enter the currency pair being traded, the amount of leverage, the number of lots, and the type of currency used in the account。

With the Autochartist function, the opportunity to make a profit is also increasing。Traders are quickly notified when a trade shows a profit signal。Trend prediction accuracy reached 83%。

Traders do not need to worry about the security of the broker's funds, OctaFX uses segregated accounts and protects personal data and online financial transactions through SSL technology, which is adjusted according to international accounting standards and regulations.。

Another advantage offered by OctaFX is the Trade & Win program。Opening an account with OctaFX will give you the opportunity to collect lots, which can be accumulated into a variety of attractive prizes. Traders only need to open a real account on MetaTrader4 or MetaTrader5 through OctaFX to redeem the prizes for this promotion. Prizes include T-shirts, Android smart watches, smartphones and laptops。

OctaFX often has bonuses and other promotions, the broker runs weekly trading competitions on demo accounts and offers real bonuses that can be used for trading。One of the prize contests is the OctaFX Champion-MT4 Demo Contest, with four winners per period and a total prize of $1,000.。

5 Ways to Choose a Hedge Broker

Opening multiple positions can lead to higher spreads。Hedging can sometimes be quite complicated due to having to focus on several positions at the same time, so forex brokers are essential for traders who use hedging strategies。

There are at least five things to consider when choosing a forex broker for hedging:

1.监管

First, you must ensure that the broker is authorized by a hedge-friendly regulator。Having said that, not all regulators support hedging, especially in the U.S.。

In 2009, the American Futures Association (NFA) introduced first-in-first-out (FIFO) rules for each trader's trades to prevent excessive trading.。Under this rule, traders cannot open long and short positions in a single account。Therefore, if you want to open a second position with the same currency pair, you must close the previous position before opening the next position, which makes it impossible for NFA-regulated brokers to hedge。

If you want to use a hedging strategy, you must avoid trading with a US-regulated broker that does not operate outside the US。In fact, you can consider many regulated brokers, i.e. brokers regulated by FCA or brokers regulated by ASIC。In addition to this, you can also consider US brokers that expand their business scope and are regulated in other countries。

2.Broker Policy

In addition to regulation, it is important to ensure that the broker itself does not prohibit hedging。This is important because even brokers that are not regulated by the NFA or CFTC may not allow their clients to hedge。Therefore, you must first check this information from the official website of the broker or ask their customer support directly。

In addition to this, some brokers are not regulated by the NFA or CFTC, allowing hedging, but imposing certain restrictions。Such brokers usually allow hedging under normal circumstances, but not on trading accounts registered in bonus plans。

Finally, some brokers may allow hedging, but often automatically cancel orders if a trader closes a position immediately after opening it。

3.Point difference

Many traders want to choose brokers with lower spreads, including those using hedging strategies, mainly because low spreads can reduce transaction costs and are very advantageous when you are hedging and opening multiple positions at the same time。

It is well known that spreads should be considered in risk management。Therefore, it is best to choose a forex broker that offers floating spreads with a minimum range of 0-2 pips per trade。Forex brokers with 5-digit pricing are also more popular because they can usually offer smaller spreads.。

4.Execute

If your hedging strategy involves pending orders, the speed and accuracy of execution is critical。If you set a buy and sell stop loss to hedge, but one or two of the orders may slip。Underprepared strategies will not succeed or bring less profit, and there is also the possibility of slippage when the market fluctuates violently, or when important economic data or other fundamental news is released。

In addition, the problem with execution is re-quotes and lags, depending on the execution speed and accuracy of the broker。However, without actually testing the real-time platform, it is impossible to know how the broker's execution service。Therefore, you can only test this aspect after registering an account, or you can also specifically choose a broker with no slippage and no re-quotes。

5.Trading platform

Finally, it is important to check the trading platforms supported by the broker。If you want to hedge using various methods (same currency pair, different currency pair or across multiple assets), avoid brokers that do not allow hedging in MetaTrader 5。

Although MetaTrader 4 is still commonly used by traders at the moment, it is possible that brokers will pay more attention to MetaTrader 5 in the next few years。MetaTrader 5 does enforce FIFO rules, but some brokers activate the hedging mode in the platform。So it's even safer if you can find a broker that supports both MetaTrader 4 and MetaTrader 5 hedges。

Conclusion

Due to the nature of hedging, there are several things you must consider before choosing a broker。Since hedging requires you to open two or more positions at the same time, you must minimize transaction costs, i.e. find brokers with low spreads and reliable order execution, which greatly affects the success of your trades。

In short, the success of hedging depends not only on your trading skills, but also on the support of the broker, so you should think carefully before choosing which broker to use。