I’m posting the blog here on Saturday cuz there’s some bad weather headed my
way and I wanted to get it up in case internet is out for most of Sunday … we’ll see.
This past week as I watched Turnkey’s LP in ETHUSD massacre the spread back
& forth like a yo-yo, I also had my eye on BTC as well … yes, BTC is literally bat
shit crazy [BSC], and whether you love it or hate it, nobody can deny it moves
… moves better than anything on the board in fact, but BTC has it’s issues … if
you’re on an “open order book” [OOB] platform trading perpetual futures, the
bid/offer spread is literally pennies … that’s the good news … the bad news are
the “gas fees” [a/k/ commissions] … unless you trade volumes per month in the
hundreds of millions or BILLIONS, you aren’t gonna get a volume discount, and at
most houses [e.g., BINANCE] gas fees are gonna be 0.1% notional of your order
for a round turn [RT] commission … that means with BTC at $45,000 the RT
commish is gonna be $45 … and if your at some houses [e.g., PHEMEX] that offer
“rebates” for those that do “limit orders”, if you do a RT trade with market orders
for both entry & liquidation, your RT commission is gonna be 0.15% … with BTC
at $45,000 that’s gonna be about $68 … granted, you get transparency & a totally
open market, but there’s a price for that.
Before this latest rally in BTC that saw it move from around 30K up to its present
price of around 47K as I write, the TOTAL COST TO TRADE BTC at Turnkey was at
an industry leading LOW of approximately $5 - $15 … now that BTC has rallied
strongly, last week saw spreads range from $15 - $25 … of course, if price goes
BSC quickly and BTC moves thousands of dollars within minutes, the spread will
go nuts everywhere, not just at Turnkey … when you compare the difference
between Turnkey and the OOB platforms, there’s no question Turnkey comes out
on top … even at $25, that equates to a RT commish of 0.05% [OR LESS!] of
notional, and on the OOB platforms unless you plan on trading a BILLION dollars
worth of BTC per month, you’re not gonna get that kind of low gas fee … however,
most OOB platforms offer much higher leverage [100X], whereas Turnkey and
most other MT4 / MT5 are at 5X or maybe 10X tops … IMHO, BTC isn’t a pair you
want to throw caution to the wind and go the high leverage route, unless you
have a death wish or need a capital loss for some reason, so for me the leverage
debate isn’t really an issue.
My main issue with Turnkey in ETHUSD, is that the supposed LP isn’t an LP, but
in fact a “market maker” looking to “game” the spread on ANY MOVEMENT UP
OR DOWN … and as far as I’m concerned that’s bullshit, cuz it adds to losers and
lessens winners by around 10%+ on most moves … from what I can see last week,
that did not happen in BTC, where spreads remained pretty consistent throughout
the week, through both rallies and breaks … and that means whoever the LP is
they aren’t “gaming” the spread, but in fact being an LP.
With “Stock Bellies” disappearing into VIX oblivion and not doing Mr. Jack Squat,
FX dead most days, and ETH a carnival con game, thank you very much scumbag
LP, BTC can serve our trading needs as well as ETH could if it were an honest
market … so, I’m making the switch from ETH to BTC … quite frankly, I’d rather
trade ETH cuz I like the dynamics, but it is what it is at Turnkey and they aren’t
gonna make any changes cuz of me I can assure you … from a trading
perspective there isn’t much difference between the two everything else being
equal, so it breaks down to a function of which has consistently a lower cost to
trade, and at least for now that’s BTC … so GiddyUp!
One final thing … I’ve decided to wait ‘till September 1 to chart “The Syndicate”
returns from trading, cuz it will give us more data points … it’ll start from
August 1 and give weekly return and NAV for participants.
Outta here … “the future looks so bright, I need sunglasses”! 😎
… Onward & Upward!!
-vegas
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