Trading Forex in Baskets to diversify trading risk for both, speculative trading or hedging Forex risk by 
I like to come back on the 3-Way Arbitrage I wrote last weekend:
http://blogs.fxstreet.com/forexhedge/2009/02/01/arbitrage/
Two days later on February 3th, the Balance indicator at the bottom on the chart below was coming back above the zero line indicating to buy the EUR/CHF and sell both EUR/USD and USD/CHF at the same time.
Today the balance indicator showing to sell the EUR/CHF and buy both EUR/USD and USD/CHF at the same time again.
The nett result is around $ 700 based on one lot each (100k.).
Not much profit, so is the risk, as they keep each other in balance more or less all the time.
Hi Ron,
how did you calculate the profit of 700usd?
Taking one lot, it means that you earned totally from this
transaction 70pips.
If we buy when the balance indicator is at 0.9998 and
sell at 1.0002 that means just 4 pips difference.
It looks that I miss something, so your help is appeciated!
Thanks/Anti
Hi thanks for your comment: On Feb. 3th. the Balance indicator was > 0 the EUR/CHF is bought at 1.4896 and EUR/USD is sold at 1.3028 and USD/CHF is sold at 1.1434.
We hold that position until the Balance indicator is going below the zero line again and reverse all positions at the same time. So 1 lot is used for each pair, which is 3 lots in total. The dot’s on the chart are the daily Wall Street closing time. The Balance line at the bottom pane is an indicator and not a way to calculate profit/loss.
brilliant
[...] Earlier post about this subject are on: http://blogs.fxstreet.com/forexhedge/2009/02/05/arbitrage-2/ [...]