Learn how easy it is to trade like a bot in this short tutorial about averages.
Disclaimer: I am NOT a CPA, nor am I licensed to issue any kind of financial advice, therefore the contents of this post are purely for educational and entertainment purposes only, and should be taken with a grain of salt.
What is your average in the market?
To better understand an average in the markets, the first thing to do is to identify its usefulness and what it is made of. Your average position is the sum of all trades for a single market distributed by a given number of items exchanged, so for example - when trading in BTC-USD you have a starting balance and a current balance, wherein the important values reside.
Total Cost ÷ Total Owned = Average Cost per Unit Owned.
In this scenario we will identify changes in your average according to a few hypothetical trades. If you trade USD$100 for 10 BTC then your average is now USD$10 per BTC, this means that you have effectively now locked your position at the price of $USD10 per Bitcoin and you now hold 10 BTC, there is no mystery there. However, suppose the market prices go up and you then decide to buy 10 more Bitcoin at the price of $20 in that case your average exists in between $10 and $20 (As you started in USD$10.00 and reached USD$20.00. Your new average is USD$15.00 per bitcoin and you have 20 BTC.
Still with me so far? Great, now here's where things get a little more interesting. As you raise your balance on one side it becomes increasingly more difficult to change your average. If the prices suddenly fell to USD$12.5 per bitcoin, you would be at a loss as you have overpaid at an average of USD$15.00, but not all is lost, let's calculate what your current market value is and see how much your bitcoin is worth before selling it and worsening your average.
So, 20 BTC at a market price of $12.5 means that the total market value for your 20 bitcoin is of $250, so in this case if you were to sell all your 20 BTC at the current market price you would gain $USD250.00 and leave the market a cozy USD$50.00! This action would result in a 20% loss for you. Knowing averages, you now see that it is not wise to sell at a loss, so instead you decide to buy 20 more bitcoin! This changes your total average and your total is now 40 bitcoin and you have spent $USD550.00.
Now, to find your new average position in the market, simply divide your cost by the total quantity and you will end with your position. $550.00 / 40 = $13.75.
Is this the same method for trading a bot uses?
Essentially, yes. Our crypto trading algorithm called Zephirex CORE does this in many different ways, and in 7 different currencies in real-time, by performing the similar functions in this example and with more data inputs, our software generates momentum in both directions, and by making small increments to the quantity purchased and sold it generates metaphorical "lift". Any time a major market change is detected, it makes precise corrections to the total average in our portfolio in over 10 different markets simultaneously, thus competing with other human traders 24/7 every day of the year.
Where do I find more information about this project?
You may visit our homepage at https://zephirex.com to learn more about our software, our official ERC-20 token called Zephirex (ZPX) and other products. For information about our newly-launched ERC-20 token visit Etherscan.io - Zephirex (ZPX).
How to support our project?
Visit Uniswap and get your ZPX today!
But wait, there's more!!
So, lucky you if you've made it this far down this post! Yes, we understand your time is money so we're going to make it worth your while. Our current air drop is giving away USD$50.00 worth of ZPX to 10 lucky winners! So send us an email or reply to our facebook post your ETH wallet so we can send you 5,000.00 ZPX! The email we will be receiving the airdrop requests in is: [email protected]. Copy and paste this email and send us your ETH wallet address and each email address within a given timeframe will be sent 5000 ZPX!
And be sure you follow our Facebook page facebook.com/zephirex for future giveaways and points of interest!
Zephirex outperforms BTC!
When comparing the BTC-USD price movement to our current portfolio we can see that the markets have seen a loss of approximately 12%, while the trading software has allowed us to profit nearly $1,200.00 USD
The above chart shows the red space used to measure the price action of BTC in the last 30 days. Currently we see an 11.88% loss in value to BTC.
The good, the bad, and the ugly
he following excel table below shows a profit of $1,180.22 in USD in the last 30 days as seen on the second column on the left hand-side. Again LTC-BTC show about a 34% ROI, the negative quantity purchased means that for the pair LTC-BTC the software is actually shorting as opposed to having a positive quantity purchased, as well as a NEGATIVE total cost, the average price per coin is above the current market price so it has sold on average well above the current market price, placing it in a profitable situation. LTC-BTC shows a net profit of USD $1,777.69
The bad and the ugly
Both DASH-BTC and ZRX-BTC show a negative return on investment above the 8%, and a combined loss of approximately USD $1,300, fortunately the other pairs are able to extract some profits and help maintain the portfolio above the "break even mark". So in essence the news is not too bad.
In other news! ZPX tokens are now available
We have created the Zephirex ERC-20 token as a form of liquidity, and it is currently available for purchase at our website here: Zephirex Token Swap Portal, where you may swap currently for ETH but more pairs will become available over time.
Here, I present to you our single-most important data table yet, displaying in all its glory once more that our algorithm is fully capable, dully-tested and confirmed to be generating income directly out of thin air. Thus, in the process of managing investments with a certain asymmetry it trades rather more advantageously than not.
A mesmerizing construct is that which produces such a desired outcome; that it far outweighs the originating elements from which it came from.
Herein, it can be observed that inevitably the total cost varies in polarity, aptly alternating between that which is positive and negative, as though it were dancing in a way as to display a certain level of elegance. So alluring in contradiction to accept its transparency as nothing more than the mere consequence of its immense obfuscated value, hidden in plain sight for the plain masses to dismiss. Patiently awaiting for the glory to surely become more and more evident over time.
For more information visit our home page at: https://zephirex.com/#pricing
Performance report is available.
Hello and welcome to our most recently updated portfolio report, visually it is represented by the percent of Return on Investment.
Please note that the column named Quote 2 is for use of pulling the data that is closely related to the actual market places in USD, we understand the fact that USDT is another form of currency, and thus it does not truly reflect the current market prices per trading pair, but it is sufficiently close enough for the time being. (Market data is being pulled from Poloniex for convenience purposes only.
So we're up $5,000 USD from 30 days ago, let's compare that to what we had before and see if it matches exactly what we are seeing or if there is some type of discrepancy in our numbers.
Noted, so according to my notes this very closely correlates with what I had about 30-days ago, and how my total balance has been increased by this amount, but what kind of earnings am I generating vs simply getting lucky remains to be seen.
For the record, our software has traded over half a million dollars in a 30-day period but this is just to show the capabilities and how it's designed to adapt to uneven changes in the market.
As of the writing of this report a few important key elements are to be taken into account as we observe the only recorded profit from all our 6 trading pairs in the last 30 days as shown below.
- The observed market changed by roughly +11.4% since Nov. 20th
- Net profit in BTC units is roughly 0.0338 BTC
Thus, (hypothetically speaking) if we were to find out what our initial investment should have been 30 days ago for us to have made this profit, we can simply divide 0.0338 by 11.4% and this gives us approximately 0.2965 BTC.
Meaning that 30 days ago we would have had to invest 0.297 BTC to profit by 11.4% and gained a total of 0.0338 BTC.
And 30 days ago a single BTC cost $18,600 USD so the initial investment of 0.297 BTC translates to about $5,500 USD.
However, since the 0.0338 BTC is now worth more than it was back then, this gain is actually close to $800 USD, so that means that if we were to make $800 USD from $5,500 USD, then that would be a 14.54% profit, and since BTC went up by 27% in the last 30 days, that original $5,500 investment would have resulted in an additional $1,485 USD as opposed to the $800.
But hypothetically speaking again, if I made 14.5 in a market where the price only went up by 11.4%, then CORE appears to have gained from the leverages between LTC, BTC, and USD.
All-in-all, the point of Zephirex CORE is to make best use of volatility as possible, and given that I have been making changes to the wallet, then this has not allowed for the software to fully close those open positions, the funds were not fully available for the software to make the safest best investments available at the time.
Calculating losses for this period.
Our performance report for the period of 10.9.2020 to 11.8.2020 shows a loss in most markets, this is due to the fact that the USD has been doing fairly weak against the BTC.
So today we'll look at the worse-performing pair -- that being ZRX-BTC, and find out why it seems to be doing so terribly.
ZRX-BTC chart analysis
When checking the 30-day price change for this pair, we see that it has fallen 32% since this period began, the orange rectangle in the chart above gives us two pieces of information when selecting the start and end range. Firstly, it gives us the 30-day period window we are currently looking at (see bottom, center of large orange section), as well as the net percentage change for this time frame (see right of large orange section rectangle).
Great, so now that we are aware of the net change during this time-frame, let's find our current average per our excel sheet. It shows that we have purchased 5300 ZRX for a total sum of 0.146 BTC, this puts us at the approximate price of 2.75e-5, or 0.0000275. And this price is marked as a gray line from the bottom 30% of the orange rectangle. So far so good, given that BTC has been spent at an average price that is above the current price, this is represented as a loss -- as selling at the current market price would be the equivalent of buying high and selling low.
Feel free to comment below on my trading algorithm's strategy, if proven effective at minimizing losses we hope to confirm this in due time with a more detailed graph of the process, hopefully one that shows both price and position when stacked on a single graph.
A requirement in trading as well as most other things in life, scaling as is defined by the Websters dictionary: v. to find out the size, extent, or amount of. And it is exactly what we are currently working on, is the ability for our software to adapt to certain changes in terms of demands for maintaining a steady volume while steadily decreasing the rate of trades in relation to the size, so in other words; larger size orders at a lower rate of fire should mean that the risk has not been drastically increased (by my current understanding of risk).
This is why the rate of trades has been decreased from an average of 18000 trades every 30 days, to roughly 16,000 trades. And the minimum size orders has been modified to increase by about 5% until a certain condition is met.
If the condition (that being for all balances to become in equilibrium and safely and steadily balance each other correctly), then the scaling can be incremented, otherwise -- if the balances incrementally are in disarray and are unable to achieve a certain balance, then the scaling must be decreased (meaning smaller sized orders at a higher rate of fire).
Correct me if I'm wrong
[Update] A new report has been made with the correct currency pair of ZRX/USD.
Our more costly loss has accounted for less than 4% in losses of our entire portfolio in the last 30 days, yet this same market has fallen 38.7% in the same time frame.
Have we gone mad here? Is there something we are missing? Is our trading algorithm outperforming the market, or have we missed a key component in the math? Why would a drop of 39% only reflect 4% in loss? Please do not misunderstand my concern, I am grateful of this aversion, perhaps this is only wishful thinking. Should there be an even greater loss?
Also, please be advised that the gaps in trades do not fully represent the extend of trades our algorithm has processed. This reminds me that we are in the process of scaling our operations to be slightly more aggressive in terms of trading volume and monitor the situation for any unforeseen events which may arise from it.