Regarding hedging trades, I often get asked questions, especially about methods like the hedging 65 strategy, which is promoted as "no stop-loss." In reality, I’ve organized an understanding of how it works and whether it truly functions.

The basic idea is simple. By holding both long and short positions on the same asset simultaneously, you profit whether the price goes up or down. That’s the core of the hedging 65 method. Essentially, it creates a "locked" state, freezing profits and losses temporarily, and waits for the market to adjust.

However, an important point is that designing a system without setting a stop-loss has significant pitfalls. Certainly, it reduces the stress of frequent stop-loss triggers typical in traditional trading. But, in exchange, capital efficiency decreases. Hedging positions require twice the margin, making capital utilization very inefficient.

Furthermore, holding positions long-term accumulates overnight interest and fees. These gradually add up and can subtly impact profitability. The biggest risk occurs when the market moves sharply in one direction. In a sudden, drastic change like a black swan event, both hedging positions can incur losses simultaneously, and in the worst case, your account could be forcibly liquidated.

In practice, if you continue with the hedging 65 method, there are some key points to consider. First, rather than completely abandoning stop-losses, you should incorporate dynamic stop-loss mechanisms. Having a safety net to avoid extreme losses is essential. Second, proper capital management is crucial. You should set strict rules, such as not risking more than 10% of your account on total positions.

Personally, I believe hedging trades are suitable for experienced traders with ample capital. For most investors, I recommend strategies that combine stop-loss mechanisms with trend-following. Monitoring market movements in real-time and balancing risk and reward tends to lead to more stable long-term results. The hedging 65 method isn’t a bad idea, but if misused, it can lead to significant losses. Use it cautiously.