Holding Positions
A trader holding a gold (XAUUSD) position overnight may face price gaps if significant geopolitical events occur outside market hours.
Example:
Definition
Traders are permitted to hold positions open overnight, meaning trades can remain active when markets close for the day and reopen the following day.
1. Holding Positions Overnight
A trader with the add-on holds a EUR/USD position over the weekend. A surprise policy announcement by the European Central Bank during the weekend causes the market to gap significantly upon reopening.
Example:
Definition
Holding trades over the weekend (from market close on Friday to market open on Sunday/Monday) is only allowed if the trader has purchased the "Hold Trades Over the Weekend" add-on.
2. Holding Positions Over the Weekend
Key Benefits of These Rules:
2.Encourages Risk Awareness:
1.Risk Mitigation:
By restricting weekend positions to add-on holders, the firm protects traders from the heightened risks of price gaps and market volatility.
Allowing overnight trades with cautionary guidelines ensures traders remain mindful of market conditions and adapt their strategies accordingly.
The "Hold Trades Over the Weekend" add-on provides flexibility for traders who prefer longer-term strategies, accommodating their needs without compromising risk management.
3.Customizable Options:
Holding Positions: Detailed Explanation
Key Considerations:
Swap Fees: Holding positions overnight may incur swap fees or rollover charges depending on the trading instrument.
Risk Management: Overnight exposure can lead to sudden, unanticipated price movements. Traders should assess the risks based on market trends and economic events.
Market Conditions: Overnight positions expose traders to potential market gaps, volatility, or unexpected news that can significantly impact prices. Proper risk management, such as setting stop-loss levels, is crucial.
Key Considerations:
Increased Risk:
Strategy Alignment:
Add-On Requirement:
Without the add-on, all positions must be closed before the market closes on Friday.
Traders with the add-on can hold trades over the weekend, subject to the firm’s standard trading rules.
Weekend positions are at risk of significant price gaps when markets reopen due to global events or economic news that occurred during the weekend.
This increased volatility can lead to substantial gains or losses.
Traders must align their strategies with this restriction, especially if relying on swing or long-term trading.
Holding positions for extended periods, such as overnight or over weekends, requires careful consideration of market conditions and specific account rules. Below is an in-depth explanation of the policies for holding positions overnight and over weekends, along with their implications:
Holding Positions
Summary Table: Holding Positions
By following these rules and leveraging the available options, traders can maintain flexibility in their strategies while adhering to risk management practices.
Guidelines for Traders:
Stay Informed: Monitor economic calendars and news for potential events that could impact the markets.
Evaluate Costs: Consider the impact of swap fees for overnight positions and potential costs of the weekend add-on.
Risk Management: Use tools like stop-loss and take-profit orders to manage potential overnight and weekend risks.
Scenario
Overnight Positions
Weekend Positions
Policy
Allowed
Permitted only with the "Hold Trades Over the Weekend" add-on
Key Considerations
Be cautious of market conditions, swap fees, and risk of price gaps.
Without the add-on, positions must be closed before Friday's market close.
Summary Table: Holding Positions
Scenario
Overnight Positions
Weekend Positions
Policy
Allowed
Permitted only with the "Hold Trades Over the Weekend" add-on
Key Considerations
Be cautious of market conditions, swap fees, and risk of price gaps.
Without the add-on, positions must be closed before Friday's market close.
By following these rules and leveraging the available options, traders can maintain flexibility in their strategies while adhering to risk management practices.
Guidelines for Traders:
Stay Informed: Monitor economic calendars and news for potential events that could impact the markets.
Evaluate Costs: Consider the impact of swap fees for overnight positions and potential costs of the weekend add-on.
Risk Management: Use tools like stop-loss and take-profit orders to manage potential overnight and weekend risks.
Profit split scaling is designed to reward traders based on their performance and preferences, giving them flexibility in how they share profits with the firm.
Profit Split Scaling
The payout process is designed to ensure traders receive their earnings promptly and conveniently.
Payouts
The inactivity policy establishes a clear guideline for the maximum allowable period of no trading activity on an account.
Inactivity Policy
More Trading Rules