Hedged orders are orders placed on the same instrument in the opposite direction.
Hedge orders can be useful for managing risk, but they can also limit potential profits. It is important to use them wisely and have a clear strategy before using hedge orders.
Hedging is often used by forex traders to manage risk in uncertain market conditions or to protect against potential losses in their trading positions. For example, a trader who is long a currency pair and is concerned about possible downside risks may hedge their position by opening a short position in the same currency pair to offset any potential losses.
It is important to note that hedging does not eliminate risk entirely, but rather aims to manage it. Hedging can also be a complex strategy that requires a good understanding of the market and the various instruments and tools used in forex trading.
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