Long and Short Positions at the Same Time?
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Long and Short Positions at the Same Time?


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Created December 21st 2013 by tderrick
Updated October 14th 2018 by Xtrader22
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Long and Short Positions at the Same Time?

  #31 (permalink)
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reversed breakouts

I happened to do this L/S adjustment on SSO/SDS positions again last nite(on this side of the globe) when S&P tried to hold the 1830 level. I was trading in size, and time and time again I feel that the cognitional responses I had real-time when having both L/S positions were much more effective, and more so when taking reversed breakout kind of entry points.

The ability to turn quickly inversely correlates to the bias built up progressively by having just one directional position. I underestimated this psychological effect for a long time.


Last edited by ptcm; January 4th, 2014 at 02:30 AM.
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  #32 (permalink)
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cory View Post
open a sub account then you can put on an opposite trade.

If you have two separate accounts with the same broker then you can effectively log in to both accounts using Ninja Trader and with a single broker license key. I do this on two separate PC's using RDP to access the second one. Don't know if you can do this with a sub account though.

Having two separate accounts allows you be short and long at the same time or you can be short/long in one and scalp trade from the second account.


Don't see that there's anything illegal about this whether from a licensing perspective nor wash sale rule.

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  #33 (permalink)
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tlopez51 View Post
If you have two separate accounts with the same broker then you can effectively log in to both accounts using Ninja Trader and with a single broker license key. I do this on two separate PC's using RDP to access the second one. Don't know if you can do this with a sub account though.

Having two separate accounts allows you be short and long at the same time or you can be short/long in one and scalp trade from the second account.


Don't see that there's anything illegal about this whether from a licensing perspective nor wash sale rule.

If you make money the vague rules may apply to you. Why don't you check with your broker and report here the reply? I think this is a too serious of a situation to rely on intuition.

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  #34 (permalink)
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solotrader View Post
If you make money the vague rules may apply to you. Why don't you check with your broker and report here the reply? I think this is a too serious of a situation to rely on intuition.

There's nothing vague, irrational nor mystical about it. Doesn't matter if you make or loose money. You can have as many trading accounts and with as many brokers as you like. For all intents and purposes, if all your accounts are ligitimate and not set up for the purpose of any laundering schemes, it is legal and wash sales rules don't apply. Many professional traders do this all the time. Moreover, you'd be a fool to have all your money with any one broker/firm. From a risk management perspective it's highly dangerous.

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  #35 (permalink)
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I guess what the flipper did playing both sides of the market spoofing is illegal then. I assume the big players still get away with it if their orders aren't hit on the other side? Maybe they're able to play both sides of the market by simply having such a large position and selling it off at certain levels and buying back at certain levels. Could someone elaborate?

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  #36 (permalink)
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Itchymoku View Post
I guess what the flipper did playing both sides of the market spoofing is illegal then. I assume the big players still get away with it if their orders aren't hit on the other side? Maybe they're able to play both sides of the market by simply having such a large position and selling it off at certain levels and buying back at certain levels. Could someone elaborate?

A flipper would still only have one position.

Spoofing is the activity of putting out fake bids/offers - but even if one of the fake bids/offers got filled - he'd still only have one position.

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  #37 (permalink)
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cory View Post
open a sub account then you can put on an opposite trade.

You can do this with separate accounts. You could be long on a major upswing, possibly staying in the trade for a significant amount of the day. As a viable scalping opportunity presents itself you could short that in a separate account.

You could then choose to exit the scalp when you are satisfied and your long will still be in place. If the scalp ends up becoming a valid reversal you can exit the long and you are now already in a profitable short.

But you do need to open a separate account.

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  #39 (permalink)
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tderrick View Post
grazie,

I looked at those threads and it appeared the concept there was to take long term positions opposite
each other with different brokers. I would assume to bail on the one that fails.


My question is - one broker, with two contracts having opposite positions at some point.

An example being - Long over all for a daily swing in markets throughout the day, but then
coming across a consolidation area that can be both bought and sold at the range edges until
the direction is resolved.

As I stated, this is allowed within Market Replay / Ninja.

I suppose I will just try it tomorrow. I will know quickly if I get that lovely NT rejection crash sound.

---------

We shall see ...

I don't think your strategy is a wash trade (i.e. is illegal)

Q1: What is the definition of a wash trade?

A1: A wash trade is a form of fictitious trade in which a transaction or a series of transactions give the appearance that bona fide purchases and sales have been made, but where the trades have been entered into without the intent to take a bona fide market position or without the intent to execute bona fide transactions subject to market risk or price competition. Parties who initiate, execute or accommodate transactions which they know, or reasonably should know, will achieve a wash result shall be in violation of Rule 534.

A wash trade requires:

a) that the transaction or series of transactions produces a wash result - meaning the purchase and sale of the same instrument at the same price, or a similar price, for
accounts with the same beneficial ownership or for accounts with common beneficial
ownership; and

b) that the party(ies) intended to achieve a wash result. Intent may be inferred from evidence of prearrangement or from evidence that the orders or trade(s) were structured, entered or executed in a manner that the party(ies) knew, or reasonably should have known, would produce a wash result.

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  #40 (permalink)
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I hate adding to an old thread but I've read about this a bit. Below is my idea of how I would do it in separate accounts, during low volatility times, when the market is moving in a predictable range. My goal would be to accumulate and distribute while having (Inventory) on both sides of the market.

I would accumulate my Sell (Inventory) when price hits the R at the top of the range. I will distribute along the way while still carrying a net short position in the market.

The same will be true for the Buy (Inventory) accumulating towards the bottom of the range, distributing at the mid-line and towards the top.

As long as price stays in balance, within this range, I will continue to keep my Buy/Sell inventory. If a breakout happens and has strength, I will 'puke out' on the weak side and keep my inventory on the strong side.

Perhaps a bad idea but I saw this being discussed on another forum with links here.


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