Regarding the hedging strategy, I often get questions about it, so I decided to organize my thoughts. Especially with methods like the "No Stop-Loss Hedging 65 Method" becoming popular, but how effective are they really?

First, the basics. Hedging, in essence, involves holding both long and short positions on the same asset simultaneously. If the price rises, the long position profits while the short incurs a loss; if it falls, the opposite happens. Theoretically, this is called a "lock position," where profits and losses are temporarily frozen, allowing you to wait for market movement before closing.

What differs from traditional trading is that you don't set a fixed stop-loss point from the start. Instead, it relies on diversified positions and dynamic adjustments to withstand short-term fluctuations. Certainly, avoiding mechanical stop-losses can prevent frequent realization of losses.

But here’s the key point: this strategy only works in limited scenarios, such as oscillating markets or markets without clear trends. In such environments, you might be able to profit within the price range.

When I hear from people actually using the Hedging 65 Method, initially it sounds attractive—"risk hedging" and "no need to predict market direction." It definitely reduces the risk of making a wrong directional judgment.

However, the costs are significant. Hedging requires twice the margin, which reduces capital efficiency. Holding positions long-term accumulates overnight interest and fees, which can eat into profits. Many people overlook this.

And the biggest risk: in extreme market events like black swan incidents, both positions could suffer losses simultaneously. There’s even a possibility that your account could be wiped out all at once.

Personally, I think this strategy is suitable only for experienced traders with ample capital. It’s not recommended for the average investor.

If you decide to try hedging, dynamic stop-loss management is absolutely essential—to avoid extreme losses. Also, diversifying funds across multiple assets or prioritizing closing opposite positions during trending markets can help.

Most importantly, leverage management is crucial. Avoid excessive leverage and keep sufficient margin in your account. Set strict rules, such as not exceeding 10% of total positions, and be prepared to monitor market movements in real time.

The no-stop-loss hedging strategy is high risk and high cost. If you seriously consider balancing profits and losses, a more practical approach is combining a stop-loss mechanism with trend-following strategies. For long-term survival, I believe that’s the better way.