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  1. Glossary
  2. /Hedging vs Netting

Hedging vs Netting

Order Types

MetaTrader 5 supports two ways of recording positions. In hedging mode you can hold several positions on the same instrument, including opposite ones, and each is closed separately. In netting mode there is one net position per instrument, so a sell against an open buy reduces, closes or reverses it. The mode is set per account and is shown in MetaTrader 5.

Example

You are long 1 lot of EUR/USD and sell 1 lot. On a hedging account you now hold two positions, one long and one short, until you close each. On a netting account the sell closes the long and you hold no position.

Related terms
  • Hedging
  • Margin
  • Market Order
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