"Is it true that you can make money by hedging using overseas FX bonuses?" "I heard it's a trick like arbitrage, but I've also heard rumors that your account will be frozen if you do it..." For those of you with such questions and concerns, this article will clearly explain the mechanism and risks of "overseas FX bonus hedging." Hedging using bonuses may seem like an attractive method to make profits with no risk at first glance, but in reality, there are strict rules and monitoring systems on the part of the brokers. If you try it without properly understanding it, in the worst case, all your accounts may be frozen and your profits may be confiscated. After reading this article, everything from the essence of bonus hedging to points on how to avoid risks will become clear. ■What you will learn from reading this article By the time you finish reading, you will not only be able to decide whether to "do it or not," but you will also understand the importance of choosing a safe trading strategy for yourself. Please read to the end and use it to manage your FX trading with reduced risk. Beginners are advised to first read the Complete Guide to Overseas FX for Beginners. Contents 1 Is it OK if you don't get caught? 1.1 What is hedging with overseas FX bonuses? 1.1 Hedging is a method of holding both buy and sell orders simultaneously. 1.2 How to specifically hedge with bonuses. 1.3 How bonus hedging generates profits. 2. Is bonus hedging essentially arbitrage? Explanation of the boundary between illegality and violation of terms and conditions. 2.1 Is bonus hedging the same as bonus arbitrage? 2.2 It's not illegal, but it may violate the terms and conditions. 3. Why overseas FX brokers prohibit hedging with bonuses. 3.1 Because there are methods that allow you to make profits risk-free using only bonuses. 3.2 Because the broker does not incur spread or commission revenue. 3.3 Because it becomes possible to realize unnatural profits and losses using other brokers and multiple accounts. 4. Is account freezing just a matter of time? Bonus hedging is almost guaranteed to be detected 4.1 Using the same trading platform such as MT4 or MT5 4.2 Information sharing between overseas FX brokers 4.3 Unnatural position patterns 4.4 Penalties such as account freezing for violating the terms and conditions 4.5 Just like using separate accounts within the same broker, bonus hedging between different brokers is also a violation of the terms and conditions 5 Common violation patterns and risks of bonus hedging 5.1 Risk of profits being wiped out by a stop-loss before withdrawal 5.2 All accounts being frozen if multiple account usage is discovered 6 Frequently asked questions about bonus hedging in overseas FX 6.1 Q. Is it okay to hed if I don't use the bonus? 6.2 Q. Which brokers allow hedging within the same account? 6.3 Q. Will I not get caught if I only do it once? 6.4 Q. What are the specific penalties for violating the terms and conditions? 7 Summary: [Overseas FX] Bonus hedging, reasons for prohibition, and the risk of getting caught Is it OK if I don't get caught? What is Hedging with Overseas Forex Bonuses? In overseas forex trading, "hedging," which utilizes account opening bonuses and deposit bonuses, is attracting attention from some traders. This method aims to limit risk by holding both buy and sell positions simultaneously while aiming for profits using bonuses, but it is prohibited in most cases. In this section, we will explain what hedging is in the first place, how it is used in trading with bonuses, and its basic mechanism. The latest overseas forex bonus information is updated regularly on the latest overseas forex bonus campaign ranking here. What is Hedging? A Method of Holding Both Buy and Sell Positions Simultaneously In forex, hedging refers to a method of simultaneously holding both "sell" and "buy" positions in the same currency pair. A position refers to the period from order to settlement, and if you enter a buy position in USD/JPY, it is called a "buy position," and if you enter a sell position, it is called a "sell position." When hedging is used, both profit and loss will occur regardless of which way the price moves. [If the price rises] [If the price falls] In other words, hedging is an effective method in range-bound markets where the direction is unclear or in times of sharp rises and falls. A range-bound market is when the market repeatedly rises and falls within a certain range, and is also called a "box market" or "sideways market." Reference: Daiwa Securities | Financial and Securities Terminology Explanation "Range-bound market" In a range-bound market where prices rise and fall, there is a chance to make a profit on either position by closing the position the moment the loss turns into a profit. ... Continue reading What is hedging with bonuses in overseas FX? A thorough explanation of the reasons for the prohibition and the risks of being caught