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bitrain (OP)
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July 03, 2011, 04:55:04 PM
Last edit: July 03, 2011, 10:08:48 PM by bitrain |
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Not now, but in december... I'm pretty sure that they will be that much and even higher in price... So, what do you think about futures, people? Is there are anybody who is ready for this kind of agreement and how we can make it  ? (let's say that for the moment it's only a study, but I'm really thinking about this possibility)... |
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lijji
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July 03, 2011, 06:53:02 PM |
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I've read a few other posts about futures and it seems very interesting.
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saykor
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July 03, 2011, 07:36:19 PM |
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If I am not in mistake... the future deal is this: you pay now for anything that will receive after few month. Usual this kind of deals is a good for both side.
I can use the money to make a new system now and mine more BTC, keep save for you to give you in December where you can sell it more than 44$ and make more profit. We both can win in this deal.
So if you pay me now 150BTC for 44$ each I agree to give you 150BTC in December.
Regards,
Saykor
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striker11111111
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July 03, 2011, 08:09:25 PM |
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This kind of thing requires a lot of trust.
However, you can easily buy 150BTC for 15-16 right now, why would you buy them from me for 44$ now?
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conjre
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July 03, 2011, 08:42:13 PM |
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This kind of thing requires a lot of trust.
However, you can easily buy 150BTC for 15-16 right now, why would you buy them from me for 44$ now?
It's a futures agreement where you would agree to sell them to someone for $44 in the future, in this case December. Their hopes are that by December bitcoins will be worth more than $44 and therefore they will make a profit. Your hope is that they won't be $44 and that you will be making a profit. |
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saykor
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July 03, 2011, 08:54:13 PM |
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It's a futures agreement where you would agree to sell them to someone for $44 in the future, in this case December. Their hopes are that by December bitcoins will be worth more than $44 and therefore they will make a profit. Your hope is that they won't be $44 and that you will be making a profit.
yes you are right. what was the name of my type of deal that i told above? |
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PatrickHarnett
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July 03, 2011, 09:02:06 PM |
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So, you're not actually ready to do this contract. Otherwise I would consider it (nominal physical delivery of BTC in December and I assume you mean payment in December as well)
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saykor
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July 03, 2011, 09:08:06 PM |
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So, you're not actually ready to do this contract. Otherwise I would consider it (nominal physical delivery of BTC in December and I assume you mean payment in December as well)
Futures agreement is a still very interesting for me. But... what is my guarantee that if the price drop in December the other side will still pay me? as striker11111111 say "This kind of thing requires a lot of trust." |
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striker11111111
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July 03, 2011, 09:47:54 PM |
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This kind of thing requires a lot of trust.
However, you can easily buy 150BTC for 15-16 right now, why would you buy them from me for 44$ now?
It's a futures agreement where you would agree to sell them to someone for $44 in the future, in this case December. Their hopes are that by December bitcoins will be worth more than $44 and therefore they will make a profit. Your hope is that they won't be $44 and that you will be making a profit. Yes I understand it but if someone thinks that bitcoin gonna be worth 44++++ in december, why not buy now at 16? What do they gain by waiting until december? Even if it was gonna be 60-70 by then, still better to buy now. Only advantage is if they don't have any money now but will be getting a lot more later, correct me if I'm wrong. |
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Arrow
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July 04, 2011, 01:15:39 AM |
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Why would you do this? They cost less at the moment.
Even if at the end of December they are worth $50 and you make a profit, you would have made more money by buying them at the current rate.
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Bonkers
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July 04, 2011, 01:38:40 AM |
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I think he means he'll pay in december too, so nobody pays anything until december. That makes a lot more sense.
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Vladimir
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July 04, 2011, 01:45:20 AM |
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he wants a call probably, if so I potentially could sell such a call for about 4$
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saykor
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July 04, 2011, 02:42:14 AM |
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but if someone thinks that bitcoin gonna be worth 44++++ in december, why not buy now at 16? What do they gain by waiting until december? Even if it was gonna be 60-70 by then, still better to buy now.
I will answer you why. Why you will make a deal to buy in December and not now: 1. You make a deal now and now will keep a money in bitcoin until December. So you can use your money in the next 6 month. If you buy now and wait to sell then in December this is a 6 month where you not will use your money. Why someone will agree to supply you with a bitcoin in December: 1. Yes the person that will sell the bitcoin in December can buy them now but this mean that he now will use his money for other thing 6 month. If he have a money that can invest now it have this option. 2. Second reason why someone can make a deal to see in December on a fixed price is that he is a happy from the price, he will know for what will work in the next 6 month, will know how many profit will make. Only advantage is if they don't have any money now but will be getting a lot more later, correct me if I'm wrong.
The advantage? For who? What is the advantage for you if seller lost a money? The idea is not to make a seller to suffer when he sell you on 44 but price is more than 44. The idea is you to be save: 1. you to not keep a money 6 month. 2. you will be save from some system crash and steal in this 6 month when you not invest in bitcoin. Regards, Saykor |
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redr0cket
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July 04, 2011, 03:50:16 AM |
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Why would you do this? They cost less at the moment.
Even if at the end of December they are worth $50 and you make a profit, you would have made more money by buying them at the current rate.
Let's say he doesn't have the money to buy them right now. He arranges an agreement where he can buy a product for a set price in the future. He might lose money, he might make a ton of money.. it's a gamble. Now if he had the money to buy right now, he probably would. But let's say that he has a contract that pays net 120( seen it in agreements before) he obviously has no access to the money now but has a reasonable expectation that he will have the money in the future and wants to set a buy price where he has the potential to make a killing. $44 seems like a number he pulled out of his ass but for the sake of the argument it still fits. |
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ascent
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July 04, 2011, 04:08:39 AM |
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He can sell the contract in September (or any other month) as well. If Bitcoins were $150 in September, he could sell the contract to someone else at a profit.
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saykor
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July 04, 2011, 04:10:23 AM |
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He can sell the contract in September (or any other month) as well. If Bitcoins were $150 in September, he could sell the contract to someone else at a profit.
if he find someone to buy it of course. who will buy the contract on price 44$ when it is 150$ in the moment and will lose a money? |
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Nevermind
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July 04, 2011, 08:06:30 AM |
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Futures contracts are not the same as call options.
I will try to explain the difference.
The buyer of a call option buys the right to enter into a transaction at the agreed upon exercise-price during the contract period (or only at the end of the period, depending on the type of contract). The buyer of a call option needs to pay the option price up front, but is not obliged to exercise his right. Obviously he would only do so if the actual price goes above the exercise price, and he would make money only if the price rises to exercise-price plus the amount paid for the option.
The pricing of these options depends mainly on calculations of the risk/chance that the exercise price will be hit.
A Future contract is an entirely different animal. With a future contract there is no payment upfront either way, it is an outright buy per a date in the future, at a price agreed upon at the outset. Both parties are obliged to fulfill the contract at the end of the agreed upon period.
For the pricing of these future contracts in the real world, at least for financial values, the only determining factor is the interest rate for the contract period.
Obviously, without a trusted exchange that carries such products and solves the trust issue, neither options nor futures are viable instruments for the bitcoin market.
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nemo
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July 04, 2011, 08:10:43 AM |
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I knew the mark of the beast was going to be a QR code.
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PatrickHarnett
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July 04, 2011, 09:29:54 AM |
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So, you're not actually ready to do this contract. Otherwise I would consider it (nominal physical delivery of BTC in December and I assume you mean payment in December as well)
Futures agreement is a still very interesting for me. But... what is my guarantee that if the price drop in December the other side will still pay me? as striker11111111 say "This kind of thing requires a lot of trust." Trust not required if done properly - margin calls fix that - both an agreed initial margin and margin variations. If one side doesn't perform, the margin is lost to the other side would be a bonus. Helps if there is a clearing agent doing the calls/holding the funds too. Having a call option is another variation - $4 premium - interesting there is a number attached to it already, well done, but no thanks. That combo doesn't work for me. |
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ascent
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July 04, 2011, 01:33:39 PM |
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if he find someone to buy it of course.
who will buy the contract on price 44$ when it is 150$ in the moment and will lose a money?
The contract is traded on market prices. There's always a market. That's how it works. |
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