What is Hedging Between Accounts? and why brokers hates it
Hedging between accounts is when a trader opens equal but opposite trades on two different trading accounts — for example:
- Account A: Buy 1.0 lot EUR/USD
- Account B: Sell 1.0 lot EUR/USD
This means there is no real market risk. One account will win, and the other will lose — but overall, the trader stays flat.
How It Abuses Deposit Bonuses
Most brokers offer deposit bonuses like:
“Get 100% bonus on your $1,000 deposit – Use it to trade!”
But there are conditions:
- You must trade a certain volume (e.g., 50 lots) before withdrawing the bonus or profits.
- The bonus might be used as margin to open bigger trades.
Now here’s where abuse happens:
The Trick:
- Open 2 accounts:
- Both funded with the bonus (either via the same broker using different identities, or 2 brokers offering similar bonuses).
- Hedge the same trade:
- One account buys, the other sells the same pair and lot size.
- Volume is counted:
- Both accounts generate trading volume — and meet the bonus conditions — without taking market risk.
- One account wins big (if the trade moves a lot). The other loses. But the winning account’s profit + bonus becomes real money, with minimal actual risk taken.
- Withdraw profits or bonus on the winning account once the required volume is met.
Why Brokers Ban It
Because this strategy:
- Fakes trading activity without real market risk.
- Wastes broker resources (server load, commission payments, bonus payouts).
- Can lead to financial loss for brokers offering aggressive bonuses.
Hence, brokers usually have rules like:
“No hedging between accounts, or accounts will be terminated and bonuses revoked.”
How Brokers Detect It
They look for:
- Identical lot sizes on opposite sides at the same time.
- Same IP address or device used to log in to multiple accounts.
- Synchronized trading patterns across accounts.
Summary: Why Hedging Between Accounts Is Banned by Some Forex Brokers
Hedging between accounts means opening equal but opposite trades on two separate accounts (e.g., Buy 1 lot EUR/USD on Account A, Sell 1 lot on Account B) — creating zero market risk.
Many brokers ban this when deposit bonuses are involved because:
- Traders can abuse bonuses by generating fake trading volume without real risk.
- One account loses while the other wins — but the volume counts on both, helping unlock the bonus unfairly.
- This results in risk-free profit farming, which violates the bonus terms.
Brokers detect this by tracking:
- Matching trades from the same device/IP
- Synchronized trade patterns
- Unusual trading behavior across accounts
This method is considered bonus abuse, so brokers ban it to protect themselves from manipulation.
Conclusion
Hedging between accounts is not illegal, but when used to exploit deposit bonuses, it violates broker terms. Always read the bonus T&Cs before trading — brokers can cancel profits and ban accounts if they detect this behavior.
ADMIN
17/09/25
