I’m playing arround with different Hedge strategies inspired by the chefmaster @Rossano .
Other than he, I tried to do it only with futures and 1x leverage. why Futures? because its cheaper to open a futures Position than a Spot.
The Logic behind the bot is to be allways in the Market (ASAP) and in both directions (Long/Short).
I open 200 Deals with a Dynamic Price deviation of 0.5 (both under and Over).
The TP is static for now (1%) but with SAR1min or Supertrend1min we can have even better results.
The bot is compounding automaticaly.
If there is a big pump or a big dump the bot can end up with stucking deals (200 open deals). If this is happening I’m thinking to close some deals manually that the bot can reopen new deals. (I’m thinking at it like @Rossano was saying “burning the fuel”)
I have several Paper Bots set up with different dynamic price (over&under) spacings. According to my experince lower than 0.5% does not make sense as every new deal will open based on the last deal so we have overlapping deals (I think there is already a features request for that).
Here is one Example of a Bot result which is open for 10days.
Very interesting @MarkusP ! I was exploring this in a bot with a config slighgtly different. anyway looks good! but im worried about babysitting the bot in case a flash crash. maybe starting one bot first doing some hedge and then starting the short if price rice can give you some advantage and not worry for the DD.
I just explore the config you propose but using the bot controller with an EMA 50 1D as a Switch to pass to full auto the strategy with less money and in Spot.
I’m actually not too concerned about the price going down—what worries me more is the price going up, since the upside is infinite, whereas the downside has its limits. We’ll see how it performs.
I’m also not worried about babysitting the bot. The strategies from Whalehunter and Rossano have their own limitations as well. From my understanding, they can also get stuck, requiring you to create a GAP Bot or even close a deal manually.
What I find interesting about this version of the bot is that it doesn’t rely on DCA. You always have the flexibility to manage each deal individually if needed.
Thanks for sharing! Can you export the bot config and attach it to the original post? Look forward to the progress, I’ve also been using mainly hedge strategies the past few months, seems like it’s in fashion these days
I won’t recommend using 1X leverage for 2 mai reasons - you will ended up paying more fees + you will have a liquidation price (better even if I won’t do it anyway to use the highest leverage possible)
When I refer to burning the fuel I don’t actually consume any base but use it to make lifetime profit.
atm if you want to set over and under it’s better to use 2 separated bots this opening price of each bot (long/short) won’t overlap
If I can give you a little suggestion - Think at the strategy like a system to scale not only at the strategy. Hope it helps
the limitations you described are actually the strength of the strategy as we want the gap to be as larger as possible - I never close any bots or deals - if a deal is stuck means it’s in profit.
Also we need at least on of the 2 bots to get stuck because it’s essential to define the boundaries of our dynamic grid (similar to when we sat a grid we need upper and lower price). Plankton instead merges long/short + min/max togehter staying closer to the current price (you will love it)
Very respectfully I think you should run the basic long/short version you will have more insights.
Why do you think it’s more expensive than spot? I have lower buy/sell price with futures and the funding rates are in my faouvor because If I get stuck in deals the funding rate is probabelly in the right direction so i will earn also with the open deals.
Why do you think a very high leverage is usefull for that strategy? I have tried it on paper with high leverage and it doesn’t work with this strat.
Thanks for the suggestion regarding two bots to solve the overlapping deal issue, thats a good point to think about.
deals serve for a number of purposes not only to make profit - you can use them to define a range, to track opened positions, to compound, to fill the gap, to define a trend, etc
If I get stuck with a deal it means either I have sold all my base in profit or I have bought cheaper base - do you think am I loosing profit? nope
Hi @MarkusP maybe what you can do is limit the amount that you use in short to the half of the long and not using isolated deal with more distance between deal and the profit of the long maybe could compensate the DD of the shorts when the uptrend start. Any way I will recommend for example start a Long now and short when price reach if it does it at 102k in this way you start with difference in your favor. A positive Gap.
Update after 14 Days:
So far the short/long bot is sitting with 3% Profit if I would close it right now (Profit - Unrealized Profit). I did also not close any deal manually but the price action is very flat at the moment.
Update after 22 Days:
Total Profit if I would Close it right now is still a bit above 3% even after the heavy crash of the last days. I did not close any deal manualy.
Hey @MarkusP, thank you for the update, i was just about to write about my experiance so far for this strategy. overall i think it’s a great strategy.You’re giving the impression that you don’t like (or want something else) the overlapping deal’s, but i actually think it’s quite clever, becuase the bot that’s in drawdown will now start to do a little bit of zone recovery, meaning that it will be able to cope with the drawdown alot faster. I started your set-up on GRIFFAINUSDT, and basically went straight into what i would think to be the worst case scenario (price dropped 37%) and while i thought it would be quiet a mess, when price started to retrace, i found that the drawdown on the long side was shrinking alot faster that it would compound on the short side, it took about 52% retracement of the 37% move to get me back to breakeven, however now i have a orders waiting above and below, just waiting for the bots to open more deals and start working with new deals. I don’t have anything to show because I stopped the bot to get out of Bybit. I personally run with double spacing Deal start and TP and half the equity on the short.
If price is ranging the constant dealstart is going to leave alot of TP’s just outside of the range (I call these Clusters), that is really good if a liquidity hunt comes along, but can be pretty dramatic if price goes the other way without clearing those first, so what i just did this morning was merge all my deals outside of the range with the ones inside to pull the total average price and TP into the range, just so i have better chance of not leaving X amount of orders outside and potentially not getting them filled.
My total profit was about 2.5% both side in 6days, before I closed everything and moved on to another exchange. I will continue to let them run and update aswell when i actaully have some more data to show on the new exchange
Nice to hear that someone else also tried the strategy. I have also other pairs which have even better results (PEPE for example). the more volatility the better.
In terms of merging deals:
I have also played arround with this but even if you do so, you are not sure that this bigger deal will get filled. So the idea of this bot strategy is to close deals manually when the total limit of 200 deals is reached. I start than to close manualy the deals which are far away so the bot can start new deals. So far I did not come into this situation. The bot could always close deals and open new ones.
The benefit of this compared to DCA is that I can manage one deal by one and I try to be always in the zone of profits. You can also think about it like a big moving claster of grids.
I would be very happy if you also could share your results!
Happy Trading
The overlapping deals would be for a sligthly different strategy… If it’s available I need to try and if it’s something which works, I can share it after some weeks / Month.
The bot does its job and sits now on 7.5% Profit after 34 days if I would close it now. The pair KAVA/USDT was very quite compared to other pairs (max DD -28%). My PEPE/USDT pair got stucked with 200 deals and I hade to manually close some deals in the meanwhile.
