/biz/ - Business & Finance

[Anonymous No.10160985]

how do i hedge bitcoin on bitmex?

let´s say I am bullish so I open a long position with 90% of my funds. Then I open (with another bitmex account) a short 10x position with 10% of my funds as hedge.

is it right? is it how people hedge btc? should use a stop loss in the short position?

[Anonymous No.10161034]

>>10160985
Why wouldn't you just short on the same account?

Also people typically hedge in the case of for example you're mining BTC and you short BTC to pay for electricity with some of your funds if BTC goes down in value and you do the math to make sure you'll never not have enough money for electricity, rent, etc.

-andranopolous the octopus

[Anonymous No.10161072]

>>10161034
>Why wouldn't you just short on the same account?

it´s not possible to be long and short at the same time on the same contract in bitmex

[Anonymous No.10161451]

>>10160985
I dont know dude, if this is how it works it's basically printing money.

[Anonymous No.10161484]

>>10160985
to hedge you hold Bitcoin in your wallet, but also short bitcoin on bitmex

In this way when Bitcoin goes down in fiat value you recover the loss from the gains produced by the short.

[Anonymous No.10161628]

>>10161484
wait, what? This makes too much sense.

[Anonymous No.10161696]

>>10161484
yeah, i understand this

but how do i optimize ?
what is a good split of fund as hedge? what is a good leverage for hedge? should i use a stop loss in the hedge position in case thing go as i expected?

[Anonymous No.10161723]

i cant find any good article about hedging bitcoin with bitmex futures

the best thing i foun was this tweet

https://twitter.com/ThinkingUSD/status/961192485518131200

[Anonymous No.10161743]

>>10161696
typically they short it in such a way as to cause the hedged Bitcoins to act like holding fiat.

so for example 2.5 leverage and they shorted using 1/2.5 their Bitcoin equivalent.

[Anonymous No.10161762]

>>10161484
but if bitcoin goes up you make nothing. this is why I used ledger nano pricelock at $18k pricelock only protects in one direction it doesn't limit you like hedging

[Anonymous No.10161781]

>>10161762
how you make nothing when Bitcoin goes up? You hold some Bitcoin so you definitely make something from that growing up in fiat value.

Okay your short could get liquidated but that could be prevented with stop loss couldn't it? I don't know thats why I ask.

[Anonymous No.10161818]

>>10161696
real answer though: make sure to take into account counterparty risk. if the exchange exit scams or gets hacked you lose money regardless of the market relative to your positions. also consider tax implications of holding in your wallet vs trading on bitmex.

[Anonymous No.10161864]

>>10161762
i tried to make a model in excel last week
let´s say you have 1 BTC and you use 10% as hedge and 90% as main position and you are bullish

Long 0.9 BTC
Short 10x 0.1 BTC

if the market goes down, your short gains equal your long losses

if the market goes up, nothing happens till your short get liquidated. then you if the market continues to go up. your gains are reduced

i dont know if this is 100% right since i am still learning

chart is USD wise.
i will post the BTC wise chart next post

[Anonymous No.10161873]

>>10161864
btc chart
if the market goes down, your short position accumulates btc

[Anonymous No.10161992]

>>10161451
nah. just risk management