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Author Topic: Liquidity problems for BIG Day-Traders  (Read 242 times)
Yama4ever (OP)
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August 25, 2017, 10:08:41 PM
 #1

Hi,

As someone who's been trading profitably for a month now, with results many daytraders can only dream of (about 10 to 1 win/loss ratio). Now I'm at a point where I want to amp up my game by increasing my order sizes.

I was wondering how the big boys manage their trading when it comes to liquidity. If you trade the highest volume coins, this is not much of an issue. But how do you deal with liquidity on the ones that fall just out of the biggest volume coins? Do you have issues getting filled? What about moving the market unintentionally. I'm talking about short term daytrading, trades range from about 5 minutes to a couple hours.

Basically, what are big money trader's issues vs the small traders?

(With big trades I'm talking about 25k to 50k trades)
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August 25, 2017, 11:30:24 PM
 #2

Trading bitcoins with that amount wouldn't be much of a problem since you mentioned that high volume = more action, thus high liquidity. However for alts that doesn't seem to have any market activity within an hour or so, doing big trades like that won't achieve you anything. You may just get dumped on if you are buying. If you want to do big trades, do it with high volume coins and not risk it with coins that doesn't have any life on.

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August 26, 2017, 04:08:23 AM
 #3

well that is THE issue. you either stick with the big coins with huge volume or you go into small altcoins with a small amount in order not to disturb the balance or change the price. but make sure to check the volume and the size of the orders in the orderbook, what you think is big may not be that big after all.

also there is a workaround too. you can always use multiple exchanges. sometimes for example a coin is available on a couple of exchanges: poloniex, bittrex,... so you can trade it on both places if you think your order size is disturbing the market.

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magneto
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August 26, 2017, 04:18:40 AM
 #4

Hi,

As someone who's been trading profitably for a month now, with results many daytraders can only dream of (about 10 to 1 win/loss ratio). Now I'm at a point where I want to amp up my game by increasing my order sizes.

I was wondering how the big boys manage their trading when it comes to liquidity. If you trade the highest volume coins, this is not much of an issue. But how do you deal with liquidity on the ones that fall just out of the biggest volume coins? Do you have issues getting filled? What about moving the market unintentionally. I'm talking about short term daytrading, trades range from about 5 minutes to a couple hours.

Basically, what are big money trader's issues vs the small traders?

(With big trades I'm talking about 25k to 50k trades)

As pooya said, this is probably the biggest issue that big traders have.

As you become more advancaded in trading it just becomes more and more of a chess game. You no longer ride the whales but rather you are the whale. You are essentially competing with other traders to gain the upper hand.

If you just want to become a market-maker then use a bot for that. The trick is to usually have multiple small orders on various sites instead of one big order on one site. That way, you won't move the market as much, or at least people won't perceive it as so.
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