Question: What's "Hedging System" on MT4/MT5 and the differences from "Netting System"?
For most of the trading platforms in the world, there are two main types of accounts available which are “Netting” and “Hedging” accounts.
Hedging Account is very common nowadays.
It is an account type where you can hedge positions and there is no limitation to the number of positions you can hold for the same symbol at the same time.
If you have an open position for a symbol, and execute a new deal (or a pending order triggers), a new position is additionally opened. Your current position does not change.
The below example shows execution of two EURUSD Buy deal 0.5 lots each:
Netting Account, on the other hand, is an account type where you can not hedge positions, but all your orders for the same symbol will be managed in one position.
Thus if you open an extra open position for the same symbol which you already have an existing open position, the new position will be added to the existing position and it will either increase or decrease the trading volume.
The below shows an example of “Netting System” when you buy 0.5 lot for EURUSD twice.
As you can see, you will only have one position eventually.
You can find the list of MT4 and MT5 brokers below.
