Would universal use of arbitrage bot stabilize the market?

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Nowadays, Bitcoin does not appear to be as volatile a currency as it was before. However, its value can move up or down within a few minutes. Here, we will find out about Arbitrage, which is used by traders who want to earn money by taking advantage of the volatility between different Bitcoin exchanges.

What is Arbitrage?

Arbitrage is a way to earn profit from the difference in price between two markets. Usually, large exchanges have a lot of members or traders who can react quickly to any news related to their market. It is called ‘liquidity’ because, on such exchanges, any asset can be turned into cash and cash into an asset. There is always someone on this exchange who is waiting for an offer and is ready to deal. Well, not always, but often. There are also fewer liquid exchanges where there are less traders and at times, when you try to sell or buy an asset there, you need to wait for someone to accept your offer and approve the transaction. We all know the old...

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Trade Bots are Haasbot’s bread and butter bot type. Trade Bots trade based on the combination of indicators, safeties, and insurances that the user sets up. A basic trade bot works by determining if an indicator (or multiple indicators) signal a buy or sell signal. This signal is then cross-referenced with the current position (bought or sold) that the user is currently in.If the users position matches with the signal type, the trade bot will then evaluate the insurances. If an insurance matches the trade signal, such as the trade covering at least the fee costs, then it will then execute a trade on that particular exchange for the amount of coins or fiat to trade.

In addition, the trade bot will also evaluate any safeties a user sets up. For instance, if a user sets a “Dynamic Drop Safety,” for a 1% drop over 2 hours, and the market suddenly drops by 1%, the bot will execute a sell to protect the users investment and to attempt to buy in lower.

Haasbot’s Trade Bot...

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I’ve never been in to day trading or forex trading. It’s actually surprising I’ve done option trading (selling) and that I’m investing in bitcoin. I used to invest exclusively in index funds and mutual funds. For those who don’t know index and mutual funds are some of the safest way to invest in stocks and they provide correspondingly low rates of return.

However in 2013 I was a bitcoin day trader. I used a strategy called arbitrage and wrote a bot to do it.

It was a relatively low risk way to earn a relatively high return.

Arbitrage is my favorite way to earn bitcoins. Unfortunately I am not currently involved in arbitrage.

#What is arbitrage?

Investopedia’s Definition:

DEFINITION OF ‘ARBITRAGE’

The simultaneous purchase and sale of an asset in order to profit from a difference in the price. It is a trade that profits by exploiting price differences of identical or similar financial instruments, on different markets or in...

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The Marketview Page is our own built in bitcoin trading platform, so that users can conduct their own technical analysis right inside of our software. You can manually execute trades on each exchange that you have added API keys into, as well as monitor one, two, or four different markets in the same tab at once!

Trading automation and our bitcoin trading platform all under one roof!

Our marketview page has everything you need for technical analysis and to execute trades manually. The bitcoin trading platform has 24 drawing tools, a trade now window, live orderbook data from specific exchanges*, all of our indicators, and candlestick pattern recognition!

* Orderbook data is only available from Bitstamp, Bitfinex (only first ask/bid), Cryptsy (only first ask/bid) Okcoin.cn, OKcoin.com, Bittrex, Coinbase, Cex.io, and Poloniex.

Our marketview page is available in all of our licenses. Think of the marketview as your own personal cryptocurrency trading...

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Has anyone heard of these and maybe purchased? I am just becoming familiar with arbitrage and looking for whatever can give me an edge. Arbitrage Underdog Reloaded, Arbitrage Cash Cow and Opportunity Bot all do the same thing except for each having their own additional bells and whistles.

From what I can see they are all designed to do basically the same thing and that is to save time searching these sites for new opportunites. I am new to arbitrage as well as to Craigslist, Fiverr and eBay. All of these are supposed to scrape (I think that is what it is called) all these sites for Gig Arbitrage Opportunities. Being new to these platforms, I am stuck on which one to go with.

Is anyone here doing Gig Arbitrage and have experience with these tools? If so, which would you recommend?

Thanks, swtp43...

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With all the allegations of Mt. Gox’s automated trading bot, which has been dubbed "Willy", algorithmic trading is getting a bad rap. However, using bots to trade on the financial markets is a long-established and legitimate activity – and it’s easier than anywhere in the cryptocurrency markets.

So, how do these bots work, and can they really make you money?

Trading bots are software programs that talk directly to financial exchanges, and place buy and sell orders on your behalf. They make those decisions by watching the market’s price movements, and reacting according to a set of predefined rules.

Joseph Lee is living proof that they can make money. Lee, who founded derivatives exchange BTC.sx, based its trading engine on algorithmic trading bots that he wrote himself, and used between 2011 and 2013.

He claims to have turned a simple $100 buy order into $200,000 in profits using his private software army. While that seems astonishing, the devil is in...

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So, I have a little confession to make. I have been running a steam market arbitrage bot for the last 4 months.

It was around Jan 13, 2013. It started when I saw a SF Scattergun being sold on the steam market for only $3. I was refreshing the new listings, and I pressed the buy button, but I was too slow, someone else had already purchased it.

Since the steam market opened in December, I had bought a lot of crates before by manually refreshing, and was also somewhat aware that other people were using bots to buy from the steam market. So, on Jan 17th, I decided to write and run a steam market bot, which would refresh the page, and start buying things at under the market price. Buy low, sell high seemed like an obvious strategy. It would output a log file, which told me whether I was fast enough or not in buying a particular item.

I kept my bots running as fast as possible by locating it as close to Valve HQ to minimise ping, so I chose the Oregon EC2 region hosting it...

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Understand the foreign exchange market.

The foreign exchange market, commonly referred to as the forex market, is an international exchange for the trading of currencies. It allows investors, from large banks to individuals and everyone in between, to trade one currency for another. Each trade is both a purchase and a sale, as one currency is sold in order to buy another one. This duality means that currencies are not priced in any one currency, but in relation to other currencies.

[1] The forex market also allows the sale of financial instruments, including forwards, swaps, options, and others. These are more complicated than simple currency trades and allow for a multitude of other trading...
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Arbitrage is a term used to describe the purchase of a product which is then immediately sold to make a profit. Arbitrage is popular in the stock market or as a means to make profit from goods being sold at differing prices in varying markets. A person who uses arbitrage is called an arbitrageur.

Arbitrage: A Simple Example

A very simple example of arbitrage would be:

Target is selling ABC DVD for $10. However, on Amazon.com the last 20 copies of ABC DVD have sold for between $30 and $45. A consumer could go to Target and purchase the copies of the movie, then sell them on Amazon for a profit of $20 to $35 per DVD.

While this is a simple version of arbitrage, it should be noted that in small volume deals such as this, it is unlikely that the consumer would be able to make a long term profit for the following reasons:

Target could run out of inventory on ABC...
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What is an 'Arbitrageur'

An arbitrageur is a type of investor who attempts to profit from price inefficiencies in the market by making simultaneous trades that offset each other and capturing risk-free profits. An arbitrageur would, for example, seek out price discrepancies between stocks listed on more than one exchange, and buy the undervalued shares on one exchange while short selling the same number of overvalued shares on another exchange, thus capturing risk-free profits as the prices on the two exchanges converge.

BREAKING DOWN 'Arbitrageur'

Arbitrageurs are typically very experienced investors since arbitrage opportunities are difficult to find and require relatively fast trading. Arbitrageurs also play an important role in the operation of capital markets, as their efforts in exploiting price inefficiencies keep prices more accurate than they otherwise would...

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Remember how the Willy and Markus bots made a huge amount of cash on Mt. Gox? Wouldn’t it be nice to try your hand at automated trading to see if you could make a nice profit, too? Well, HaasOnline Software just released Haasbot 1.0 for you to trade on ten exchanges in over 500 cryptocurrencies.

Haasbot 1.0 includes arbitrage bots, order bots, and scriptable indicators. With bots, there’s always the risk of a malfunction, but likewise, there’s always a chance to turn a profit.

Also read: Malfunctioning Bitcoin Trader Bot Causes Extremely High Volume on the Bitcoin Exchange BTC-e

Haasbot – Arbitrage Trading for the Masses

Haasbot brings arbitrage trading, scriptable indicators and order bots to the public, and you can develop countless trading strategies with them.

Scriptable Indicators

Bot developers can write scriptable indicators in the powerful C# programming language. TA-Lib support is available for powerful Technical Analysis...

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A hedge is an investment position intended to offset potential losses/gains that
may be incurred by a companion investment. In simple language, a hedge is
used to reduce any substantial losses/gains suffered by an individual or an
organization.
A hedge can be constructed from many types of financial instruments, including
stocks, exchange-traded funds, insurance, forward contracts, swaps, options,
many types of over-the-counter and derivative products, and futures contracts.
Public futures markets were established in the 19th century[1] to allow
transparent, standardized, and efficient hedging of agricultural commodity
prices; they have since expanded to include futures contracts for hedging the
values of energy, precious metals, foreign currency, and interest rate
...

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X-Feeder is a program for automating trading at a popular online bet exchange BetFair Exchange Games.

While step 1, that is placing simple bets trying to guess a winner, is important for understanding how the exchange works, real pros don’t leave anything to chance. They use X-Feeder to build their strategies based on certain rules or criteria that they instruct the program with. As a result, they act faster than those without the bot and they are less prone to mistakes as all the calculations are made by the program. Plus they benefit from the ability to control their bets through profit & loss charts, action log files and numerous settings available in X-Feeder.

Download X-Feeder now!

It is absolutely free and allows you to master the Games as quickly as possible. You will start placing your first bets shortly after logging in. Guess what? The bets will be risk-free, as the lite version operates virtual money: that is you can use it even if you don’t have...

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What is Arbitrage Trading ?

“Arbitrage” trading is simply the trading of securities when the opportunity exists during the trading day to take advantage of differences in value between the markets the trades are made within. Arbitrage trading takes place all day long on most days that the markets are active.

Arbritrage is legally allowed. In fact arbitrage is responsible for a large part of the daily volumes on the NSE & BSE exchanges.

What mainly takes place in India is called Market Arbitrage
Market Arbitrage involves purchasing and selling the same security at the same time in different markets (BSE & NSE) to take advantage of a price difference between the two separate markets. A market arbitrageur would short sell the higher priced stock and buy the lower priced one. The profit is the spread between the two assets.

Here is a simple example:

Suppose you own 600 shares of RPL. One trading day you notice that RPL is trading at 150 on the...

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A possible solution is to not ban sales to bots per-se, but instead verify that the identity of the person redeeming the ticket at the door is the same as the person who purchased the ticket (via verifying CC details, or even something as basic as their name).

If tickets have conditions on them that prevent their usage by anyone other than the person who originally bought them, then there can be no market for resold tickets. Let the scalpers buy as many tickets as they want, but eliminate the market for them to be resold.

Ticket Australia now state as part of their conditions of sale "This ticket may not, without the prior written consent of Ticketek or the Seller, be resold at a premium or used for advertising, promotion or other commercial purposes (including competitions and trade promotions) or to enhance the demand for other goods or services. If a ticket is sold or used in breach of this condition, the bearer of the ticket will be refused admission."

If...

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When I was a kid, I loved old cameras.

I didn’t want to shell out $5 for a roll of film to actually USE one, mind you – that would have meant no comic books for almost two weeks – but I adored the look of them.

If it had flashbulbs, even better.

If it had a bellows, better still.

Every Sunday, when I went to the flea market with my mom, I would make a point to stop and look at whatever old cameras the dealers brought with them that week. Often it was the same few people that stocked them, and usually it was the same small group of cameras. It wasn’t long before I had the prices memorized, which meant that my developing brain had a rudimentary idea of what each old camera was worth.

Before long, I started looking out for bargains.

I’d scour the tables of people who brought boxes of junk from their attics and garages. A few times, I found a camera that the dealers were selling at $10 for a quarter or fifty cents.

I’d buy it without...

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how do you center your market? Like you said you work bids and asks some distance away from a price. How do you determine this fair price? Is it model driven or something you input?

I sort of explained this above, I tell the bot to maintain a fixed $ amount of Bitcoins (ex: $10,000), and at whatever price this value is exceeded by a set amount (ex: $100) it picks that as a 'center' for a bid/ask pair.

how do you decide how wide your bid and ask prices should be apart? You mentioned it's a function of volatility but do you use a model or just do it based on your feel for the market? Is your spread always symmetric or do you ever ask for less edge on one side of the market? If so, why?

I dialed in the spread based on my observations of the market fluctuations when I was running the bot last year.

The orders profit are backed off exponentially 0.4% -> 0.8% -> 1.6% -> 3.2% -> 6.4% -> 12.8%. This tries to accomplish two things: Fill as many orders as...

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Demystifying Hedge Funds

Angel Ubide

Hedge funds may have an aura of exoticism and modernism, but their goals are as old as the art of investing itself. They seek a positive annual return (the higher the better), limited swings in value, and, above all else, capital preservation. They do so by using the best of what modern financial science can provide—rapid price discovery; massive mathematical and statistical processing; risk measurement and control techniques; and leverage and active trading in corporate equities, bonds, foreign exchange, futures, options, swaps, forwards, and other derivatives.

Because of their nature, hedge funds are restricted to large-scale...

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A:

Arbitrage is basically buying in one market and simultaneously selling in another, profiting from a temporary difference. This is considered riskless profit for the investor/trader.

Here is an example of an arbitrage opportunity. Let's say you are able to buy a toy doll for $15 in Tallahassee, Florida, but in Seattle, Washington, the doll is selling for $25. If you are able to buy the doll in Florida and sell it in the Seattle market, you can profit from the difference without any risk because the higher price of the doll in Seattle is guaranteed.

In the context of the stock market, traders often try to exploit arbitrage opportunities. For example, a trader may buy a stock on a foreign exchange where the price has not yet adjusted for the constantly fluctuating exchange rate. The price of the stock on the foreign exchange is therefore undervalued compared to the price on the local exchange, and the trader makes a profit from this difference.

If all markets...

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