For example, if a trader buys 1 lot of USDJPY, he can then eliminate his exposure to a falling USDJPY by selling a second lot. On the GCI platform, this can be done by either right-clicking on the long USDJPY position and selectingn "Hedge" position from the pop-up menu (as pictured below), or by simply selling another lot from the "Dealing Rates" window.
This will result in one long position ("B") and one short positiong ("S") in USDJPY, as shown below. Note that these two positions do not offset and cancel each other.
The trader can then manage each position separately, using stops, limits, or market orders to close each "leg" at the most opportune time.
