Automated Trading


What is Automated Trading


‘An automated trading system (ATS) is a computer program that creates orders and automatically submits them to an exchange, based on predefined set of rules.’

 

E.g. You set an Automated trading system, or bot, to buy Bitcoin every time the price is below $1000 and resell every time it’s above $1200, and the program will execute it automatically for you.

 

How does it Works

 

After selecting a pair of assets (e.g. BTC - ETH), this strategy automatically converts the half of the investment in the counter asset (in this case ETH) and automatically places orders to buy and to sell in order to produce profits, according to the parameters you select.

 

E.g. You own 1 Btc and want to start a strategy BTC-ETH. After selecting BTC as your base asset, you will insert the amount 1 in the Investment Box. After starting ½ of that BTC will be converted in to ETH, and from there the strategy will start making profits in both BTC and ETH.

 

Secondly, you need to select the risk level. The risk level is the amount of maximum loss you are willing to take with this strategy.

 

E.g. You own 1 Btc and may only be willing to lose 30%, before terminating the strategy. If that were to happen, the strategy would close before the selected level avoiding further losses.

 

Minimum Profits (from sale/buy) will be the percentage amount at which each asset will be sold. Select according to your preferences. (See Section: Minimum profits, to learn how to select optimal values). The strategy will sell at the preselected-percentages over time, looking to increase your initial investment to the Lock in Profit level.

 

E.g If you selected 2% Minimum Profit from Sale, the strategy will now sell part of your ETH holding at a 2% profit. Similarly if you selected 3% Minimum profits from buy, it will rebuy 3% below the initial price of when the strategy was started.



Lock In Profits will be the level at which the strategy will be terminated. After reaching the pre-selected Profit level the funds will be reconverted (the strategy will be closed) in to the original assey.

 

E.g. After re-buying and selling BTC and ETH, you funds have reached 30% profit (that you had previously selected). The strategy will be now closed and you would be left with 1.3 BTC, at a 30% profit.

 

Additional Parameters:

Restart Levels are a level after which the strategy will restart. If you selected a minimum Profit and the price has raised far above, this function will allow the strategy to restart.

 

E.g. If you selected 2% Minimum Profit from Sale, but the price has now raised a 10% higher, you strategy will be waiting for the price to drop to execute its orders. With this function, if you set the Upper Restart Level at 10%, the strategy would have restarted at that level.

 

Kick In Price is the price at which you wish to start the current strategy. If you believe the might be a sudden fall and would like to start the strategy later, you can set a price, at which the strategy will start.

 

E.g. If you believe BTC price is now to high at $7000, and would prefer to start the strategy later, when the price is lower that $6400; you can set the Kick-in Price at which the strategy will start. After reaching $6400 the strategy will automatically start.




Selecting the Minimum profits

 

To benefit to the full extent from our strategies, selecting the ideal pair and volatility is essential.The ideal pairs are the one with most volatility, however, they can also be the most risky.

After selecting a pair, its essential to set the Minimum profits from buy and sell correctly, according to the current volatility.

 

TIPS: Use the Volatility Indicator on top of the graph.

 

E.g. If the volatility on the graph’s indicator is showing 0.18, you may want to set your Minimum Profits from Sell slightly below that, and similarly with your Minimum Profits from buy.

 

Additionally, the best pairs to choose are usually ones with frequent similar wavelength fluctuations, where the bot can better perform.