Bitcoin futures hedging strategy discussed

Author: lazyp, Created: 2016-04-13 12:44:09, Updated: 2019-05-08 15:46:54

The following points are difficult for individuals to solve:

  1. The futures are denominated in fixed RMB or USD units, for example, a contract of 100 RMB, but the spot is the number of RMB as the unit of trade, then one contract is exchanged for the number of RMB during the hedging process, this step will have a precision loss. For example, if a 100 yuan currency is sold on a futures exchange and the cash is bought for 0.036 ((99.248), then the place is a few shillings less.
  2. In the case of futures, it takes four trades to complete a hedge, so the probability of error increases significantly, as we all know that the technology of the current exchanges is very poor.
  3. It's hard to do without a bomb under the cover of a black platform.
  4. The distribution mechanism, at the end of the month, futures make hundreds of dollars, cash loses dozens of dollars, and may be partly distributed out, and the total profit will be a loss.
  5. Of course, there is also the issue of not having enough depth in the futures, which can lead to some orders being processed, which are also difficult to process.

We invite you to come and discuss strategies and see if we can solve them.


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The grassYou can find some open futures or forward quotes here: https://www.fmz.com/square/s:tag:%E5%AF%B9%E5%86%B2%E5%A5%97%E5%88%A9/1 It's not just the media, it's the media.

js8848I'm not sure what you're talking about. 1. The interest rate is fixed, OK International is obviously more suitable than VC, OK has a seasonal contract, and the depth and volume of transactions are good, which can easily generate high inflows at certain times, such as last November. 2. The precision loss you mentioned is almost negligible, if there is a compulsion, the threshold is adjusted accordingly after the completion of the open position by using the total amount of the open position/holding cost - the opening transaction fee, compared with the number of purchases of the spot. 3. Transfer 0 confirmation between OK China Station and OK International Station, almost second to account, instant transfer to futures account immediately after purchase, no possibility of bust. 4. The risk of spreads does exist, but it belongs to the black swan, OK. The current risk reserve system has better controlled this risk, of course not completely eliminated, the possibility of losing money in extreme markets, and the risk of spreads in LTC futures is much greater than in BTC futures. 5. The depth of the spot is absolutely not to worry about, OK quarter and the depth of the week can be accepted, unless you have a large amount of funds in the tens of millions of billions of dollars, of course there is such a large amount of money operation method is completely different. Futures are generally stable, but the difficulty is in determining their positions. It is difficult to see a rise in long-term market volatility. In addition, capital utilization is not as efficient and leverage is not as effective as futures.

The BubbleThe lower the price, the greater the risk of unilateral losses. A reasonable price difference or even multiple price differences can better control the risk.

tfboysI said: The determination of the leverage band can be graded, the grading determines the threshold; when to break even in a dynamic market is a technical skill.

NMy current procedure is basically the same as Zero's. Add: 1, in terms of the actual effect, the hedge is 99% equivalent, the loss of accuracy is not significant; 2. A reasonable hedge pricing setup can cover all losses and costs from mistakes; 3⁄4 Individuals believe that the difficulty of hedging is in determining the no-profit zone.

ZeroIn response to your question, tell me what I think: 1. timely balance, e.g. after a position has been opened, calculating the amount of money or coins to be added, from the smallest side of a single transaction, e.g. on the cash side, regardless of the smallest transaction amount This is going to take a lot of detail, and the magical bugs of the exchange are waiting for you -- 500 lines of code, you could do 5,000 lines of code -- to fix the bug. Control the use of collateral, for example, using only half of the funds at 10x leverage, even if it is 5x leverage, automatically adding collateral of course 4. This is inevitable. It can be seen as a cost. 5. The first party to the deep trade is good, the other party has calculated the position of the other, and it is not recommended to open the position at the same time.

NI'm a former driver.

js8848I agree with you, except I don't program, it's all manual, can you communicate? 313988164, thank you

js8848Since it is a futures hedge, how much of your fiat capital you have, how much of your money you open up for free, all the cash you buy in fiat currency is used as collateral, and you will never go bust. Of course, you can choose to misappropriate some of the cash you buy for other speculative activities, but the premise should be to ensure that your holdings do not explode. The current interest rate is basically a small interest rate, the utilization of funds is not high, and of course the risk is minimal. A quarter of luck is about 3 to 5%, good luck can earn 10% or even 20% of the capital. At least it is stronger than fiat bank finances and P2P. If you want to make the most of leverage, you can try using the leverage offered by black platforms, unless you have an online financing capacity of less than 8% per annum.

lazypIf you say raise the collateral, then your costs will be very high, the utilization of capital will not go up, and the yield will not be ideal.

lazypBig money, micro-money feels too slow, and if you do a lot of micro-money quickly, it's actually the same as the next one.

lazypThis is indeed a technical work.

NFor the leveraged trader, the opportunity to leverage is indicated beyond the no-leverage range, while within the no-leverage range the futures are priced reasonably and there is no leverage.

lazypThank God for the answer, Mom!

lazypWhat does it mean to define a no-interest zone?