Top Stories
by ForexNewsNow Team on August 27th, 2010

Forex hedging: How do FX traders execute forex hedging?

Forex hedging - RBA President Glenn StevensNEW YORK (Forex News Now) – Forex hedging is the establishment of a position in a bid to offset exposure to price fluctuations in some opposite position.

For example, if FX traders wish to sell euros and buy dollars, and yet also guard against EUR/USD shooting up rapidly as well, they would engage in forex hedging by placing the relevant stop loss and take profit orders.

As such, forex hedging enables FX traders to minimize their exposure to risk, to a certain degree.

Forex hedging is often employed with regard to indicator analysis, when it is believed that realtime forex news could cause sharp movements in a currency pair’s FX rate. Forex hedging is also commonly employed in technical analysis trading.

In short, forex hedging is a useful strategy to consider when engaging in currency market trading.

By ForexNewsNow Team

This is a general account of the ForexNewsNow Team. It is used to published exclusive content carefully crafted by our experts as well as it is used to bring you the most recent industry highlights from our guest contributors that wish to remain anonymous.

More content by ForexNewsNow Team

Comments (0 comment(s))