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FX options used instead of stops


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  #1 (permalink)
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Do you have any experience in using options instead of stops in fx trading? ( fx spot trading or fx futures)


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DAX trader View Post
Do you have any experience in using options instead of stops in fx trading? ( fx spot trading or fx futures)

There are several options webinars on NexusFi (formerly BMT), I believe they all touch on doing this.

Otherwise you'll need to be more specific if you want more info.

Mike




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  #4 (permalink)
DAX trader
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Big Mike View Post
There are several options webinars on NexusFi (formerly BMT), I believe they all touch on doing this.

Otherwise you'll need to be more specific if you want more info.

Mike

Thanks Mike.

Unfortunately I can't be more specific as I do not have any experience with trading options.
It's only that I've heard about that from one fx trader and was intrigued by the idea - liked it. I would love to be able to control risk without using stops (avoid stop hunting).

That's why I asked, expecting some info especially from fx traders who do use such a technique


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  #5 (permalink)
 
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 sam028 
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It might be a good idea on long timeframes, to reduce a bit the slippage and commission costs of the options.
But no magic, covering your trade by an option can limit your loss, but it will limit your profits too.


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  #6 (permalink)
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sam028 View Post
It might be a good idea on long timeframes, to reduce a bit the slippage and commission costs of the options.
But no magic, covering your trade by an option can limit your loss, but it will limit your profits too.

Thanks Sam.

Well, I was expecting a bit of magic really - keeping an open position till it turns good (not worrying too much/closing it when in loss). It seems as if I need to stick to old fashioned stops and hope for little or no slippage if there is such a thing.

May even try fx futures one day - they look more transparent (than spot fx)


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