With all the turmoil I have hedged a few trades. By this I mean that for every short I have created and equal sized long and vice versa.
Now I would assume that my drawdown remains stable, because when a pair moves the short and long orders should cancel each other out. However, to my surprise, my total amount of drawdown is still moving, even though I have hedged all my trades. What am I missing?
Now I would assume that my drawdown remains stable, because when a pair moves the short and long orders should cancel each other out. However, to my surprise, my total amount of drawdown is still moving, even though I have hedged all my trades. What am I missing?