Calculating base order for S10 and trying to optimize it


I was trying to think of a way to use the S10 strategy that could fit everyone without having to think too much about the risk of being stuck in case of a big drawdown. Also, I wanted to deal with the risk of being overexposed or underexposed to the market, yes “underexposition” is also a thing that you don’t want if you want to make as much profits as possible :smiley:

At the beginning I was thinking that the best move would be to use a compound strategy with %free USDT or %USDT total. But after looking it closer, the problem with that strategy is that you are not really getting the benefits of the ups and downs during a drawdown. Long story short, if your position is a percentage of the total and you are making some wins during a big drawdown (bear market), these wins will not allow you to cover more than the total drawdown (might be wrong, the experts on S-strategies can confirm?). At the opposite, using a defined amount of dollars each deal, allows you to cover a bigger drawdown because if the coin you are trading is not the worse shitcoin, it will be doing ups and downs during the downhill and you can profit from them in order to open more positions if the price is going lower. The key point is the possibility to open more positions with the profits generated during the downhill.

The first step to define how much base order you should invest in a S-strategy is to try to identify the number of deals that seems secure. To do this, I got inspiration from @d_yo_r table and made my own with -1,00% deviations:

Deal Deviation (%) Total drawdown BTC Price ($)
1 0.0000 0,00% $100.000
2 -1,00% 1,00% $99.000
3 -1,00% 1,99% $98.010
4 -1,00% 2,97% $97.030
5 -1,00% 3,94% $96.060
6 -1,00% 4,90% $95.099
7 -1,00% 5,85% $94.148
8 -1,00% 6,79% $93.207
9 -1,00% 7,73% $92.274
10 -1,00% 8,65% $91.352
11 -1,00% 9,56% $90.438
12 -1,00% 10,47% $89.534
13 -1,00% 11,36% $88.638
14 -1,00% 12,25% $87.752
15 -1,00% 13,13% $86.875
16 -1,00% 13,99% $86.006
17 -1,00% 14,85% $85.146
18 -1,00% 15,71% $84.294
19 -1,00% 16,55% $83.451
20 -1,00% 17,38% $82.617
21 -1,00% 18,21% $81.791
22 -1,00% 19,03% $80.973
23 -1,00% 19,84% $80.163
24 -1,00% 20,64% $79.361
25 -1,00% 21,43% $78.568
26 -1,00% 22,22% $77.782
27 -1,00% 23,00% $77.004
28 -1,00% 23,77% $76.234
29 -1,00% 24,53% $75.472
30 -1,00% 25,28% $74.717
31 -1,00% 26,03% $73.970
32 -1,00% 26,77% $73.230
33 -1,00% 27,50% $72.498
34 -1,00% 28,23% $71.773
35 -1,00% 28,94% $71.055
36 -1,00% 29,66% $70.345
37 -1,00% 30,36% $69.641
38 -1,00% 31,06% $68.945
39 -1,00% 31,74% $68.255
40 -1,00% 32,43% $67.573
41 -1,00% 33,10% $66.897
42 -1,00% 33,77% $66.228
43 -1,00% 34,43% $65.566
44 -1,00% 35,09% $64.910
45 -1,00% 35,74% $64.261
46 -1,00% 36,38% $63.619
47 -1,00% 37,02% $62.982
48 -1,00% 37,65% $62.353
49 -1,00% 38,27% $61.729
50 -1,00% 38,89% $61.112

I chose 25 max open deals (each deal opens after 1% deviation) because it seemed to me that it was quite secure and quite hard for a coin to do a 21,43% without some minimum recovery (it’s possible and already happened but I can assume this risk mainly because I’m trading BTC). What is important here is to divide your investment in that strategy by the number of deals that you can assume to have in red. In this case we can take the example of a 2500$ investment divided by 25 max open deals, this means that base order has to be 100$. Use the following formula to find your ideal base order:

B = I / D (B: Base order; I: Investment amount; D: max open deals that you can assume to risk based on the table before).

Now comes the good part. In order to maximise the profits what we don’t want is to have too much money that will not be used (obvious). So what I propose here is a manual compounding method that has not the drawbacks of the %free and %total that I presented earlier in this post. The method is quite simple, you only need to edit the bot and change the base order size each time that you have profits with the bot, BUT there is ONE RULE and it is that you can only do that if there is JUST 1 OPEN TRADE.

To adapt your order base, you only need to use the B = I / D formula.

Why these rules? Because when you do this you are doing compound but at the same time you are limiting the risk of being stuck in the market. By doing this you are going significantly faster than by having sitting bags waiting for a big drawdown, also you are limiting the risks of being stacked.

This solution is not perfect because in a bull trend it is way more optimal to use an automated compound strategy, but it has some potential to be automated, the only problem is that the automation should be only useful for this S10 strategy as the rule is quite specific and I don’t know if it’s worth it for the devs to work on something that will only be useful for this strategy.

I was also wondering if this could solve the problem of the compounding of the base not working on the S-strats.

@Rossano tell me if this makes sense, it has some similarity to what you have posted here AUTO-Compound profit %. Also I thought that this was the right place to publish this to have a separate conversation from the (S-10) DCA by Simultaneous Deals, but I can delete the post and copy it on this already existing topic.

Sorry again for this very long post!

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Thanks for this post mate really appreciate - every little comment or feedback helps the strategy in getting better for us and ultimately for the community :heart:

It’s great that you are pondering about this strategy, I’m still developing all scenarios myself to get it right as I would.

This manual compound won’t work because the bots close a lot of deals everyday and you don’t won’t to edit the bot 10 times a day for example - also the strategy should’t have only 1 open deal because of one aspect of the strategy I’m working on - SPEED - this means overlapping deals within a specific offset so a little portion of the price range is used by more than one deal. This allow the bot to be faster and to gain more.

I love the idea of being underexposed and this could open new potential not only for this strategy but for any strategies - I will have a think about it :wink:

– I will add more comments as soon I have a moment
Thanks again for your input

Will be happy to see that new feature you are working on :grin: But for now, I think that this could work, of course compounding 10 times a day it can be too much, but once per day or per week would be better than doing nothing for the strategy as it is now, don’t you think so?

Hello again!

I’ve been doing some more tests to try to define the best base order and max open deals allocations. The idea behind this tests is that if we start a bear market as strong as the one from november 2021 to july 2022, what would be the best settings? To backtest this I just tried each several amount of max deals and defined the base order using the formula above (B = I / D). During this long backtest period I found that I was wrong when I said that we should not use an automatic compound method. In fact if it’s rightly calculated, % USDC total can be used. For me what means rightly calculated is that there are no “no deals” period. To do that I thought that my investment should be able to cover a hole bear market but everyone can use his own strategy to feel safe. You can still use the formula above (B = I / D) but with a % for the base order.

The results are here:

There are some interesting things here.

  1. The best number of max open deals would have been 30 without using compound method. This is a fact, the best net result is obtained with this number of max open deals. But if you look at the number of deals column you see that there are much less deals than with other tests presenting a higher number of max open deals. This is because at some point during the bear market you will be out of deals because you need more funds than what you really have. You can see this at the following picture where there is a long period without deals at the end of the bear market.

  1. The max number of open deals that an be obtained is with around 110 max open deals. This means that if you want that you bot never stops working in a similar condition than the last 2021 bear market, you need around 110 max deals (and of course a base order proportional to this amount of open deals). More max deals is not leading to more deals or better profits (which makes sense as your base orders will be less important). But, and this is important, the net result is less than what you can have by putting only 30 max open deals. This means that is preferable to only put 30 max open deals and stomach the months without opening deals (no free money during this “no deals” situation) than putting 110 deals. The only thing is that when you are in a bear market, you are never sure that the price will come back to the highs where it began, so you should HODL like a warrior and no panic (something hard during these kind of conditions).

  2. Using compound is always the best option BUT it needs to be calculated correctly to not use to much funds too fast. Here the parameters that seem to have more sense and that are safe enough is to use 1% USDC total for base order with 100 max deals, is the safer way of stomaching a big bear market by making constant “free money”. It will be considerably more slow during a bull run, but it’s safer in case of an unexpected downtrend. I share with you the settings of this bot:

Safe-compound S10:Gainium app (be aware that you will probably need a substantial amount of money to run this correctly because with less than 5000$ the TPs might be to small and the bot cannot start)

Max profits-compound S10: Gainium app (be aware that this one is not capable of supporting a 2021 bear market)

Ok my head is burning at this point :fire: feel free to point weird and wrong things, to ask questions and to backtest these bots! I will be glad to here from you!

PS : Thanks to the Mastermind of the S10 strat of course @Rossano :heart:

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Thanks @Perez really appreciate your effort in breaking down all aspects of the S-10 and the strategies of the S-Series - you are really narrowing down the reasons and further evolution of the S-1 evolved overtime.

I will add my thoughts on this tomorrow when at my desk :blush:

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I have so much ideas, my to do list is full of things :joy:

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