How do you trade on the account with the netting accounting model?
When trading with the netting account model, you can only have one open position in the same instrument. Therefore:
- If you open two orders in the same direction, the open position will increase.
- If you open two orders of the same volume but in different directions, the existing position will be closed, and a new one will not be opened.
- If a new order is opposite to the existing one and exceeds it in volume, the current position will reverse in the opposite direction.
- If a new order is opposite to the existing one and has a smaller volume, the current position volume will decrease.
How do you trade on the account with the hedging accounting model?
When trading with the hedging account model, you can open as many positions as you want in the same instrument in different directions, in case there is enough margin for opening and maintaining them.
If you already have an open order in some instrument and you decide to open another one, you will have one more open position. Unlike the netting model, in the hedging model opening a new position in an instrument has no influence on existing ones.