The Bitcoin Trading Group

[FXTrader]

Is there a difference in your commission for a higher volume account?

For example, Id I gave you my api key to one of my accounts, letting you trade with 10k USD to start, will you take the same commission from me as you would an account with $500.00 ?

-Charlie

Charlie,

I will answer this question for both performance and account commission:

1.  Performance commission - My performance commission is based on the bitcoin I was able to generate in your account.  I am trying to generate BTC profit for individuals who are following our trading account.

2.  Mt. Gox commission - this is for your account and varies with your volume, but my performance commission is after your Mt. Gox commission.  So my performance incentive is your gains net Mt. Gox commissions.

I prefer accounts to be opened in bitcoin.  My performance commission is based on the bitcoin I generated in your account.  At the end of a trading cycle, I will "flatten" my positions by buying bitcoin so if your objective is to maximize USD, I would suggest different trading programs.

[Yankee (BitInstant)]

Is there a difference in your commission for a higher volume account?

For example, Id I gave you my api key to one of my accounts, letting you trade with 10k USD to start, will you take the same commission from me as you would an account with $500.00 ?

-Charlie

Charlie,

I will answer this question for both performance and account commission:

1.  Performance commission - My performance commission is based on the bitcoin I was able to generate in your account.  I am trying to generate BTC profit for individuals who are following our trading account.

2.  Mt. Gox commission - this is for your account and varies with your volume, but my performance commission is after your Mt. Gox commission.  So my performance incentive is your gains net Mt. Gox commissions.

I prefer accounts to be opened in bitcoin.  My performance commission is based on the bitcoin I generated in your account.  At the end of a trading cycle, I will "flatten" my positions by buying bitcoin so if your objective is to maximize USD, I would suggest different trading programs.

Ok, I may open a new account and buy 1000 BTC to start, have you started the cycle yet?

[FXTrader]

Is there a difference in your commission for a higher volume account?

For example, Id I gave you my api key to one of my accounts, letting you trade with 10k USD to start, will you take the same commission from me as you would an account with $500.00 ?

-Charlie

Charlie,

I will answer this question for both performance and account commission:

1.  Performance commission - My performance commission is based on the bitcoin I was able to generate in your account.  I am trying to generate BTC profit for individuals who are following our trading account.

2.  Mt. Gox commission - this is for your account and varies with your volume, but my performance commission is after your Mt. Gox commission.  So my performance incentive is your gains net Mt. Gox commissions.

I prefer accounts to be opened in bitcoin.  My performance commission is based on the bitcoin I generated in your account.  At the end of a trading cycle, I will "flatten" my positions by buying bitcoin so if your objective is to maximize USD, I would suggest different trading programs.

Ok, I may open a new account and buy 1000 BTC to start, have you started the cycle yet?

The first investment cycle will begin in the next 48 hours.  The first trade will happen as soon as the market presents a trading opportunity.

[DonnyCMU]

Cycle begins in 48 hrs? I'm interested too.

2.   We will trade in the hopes of growing the bitcoin balance of individual participants

But one more question, is your goal to maximize the USD value of the account, not the number of Bitcoin in account, right?
For example, if BTC/USD are to slide down to $2 over the next month, it wouldn't be consider a profit even if you manage to double the amount of bitcoin we have.

[FXTrader]

Cycle begins in 48 hrs? I'm interested too.

2.   We will trade in the hopes of growing the bitcoin balance of individual participants

But one more question, is your goal to maximize the USD value of the account, not the number of Bitcoin in account, right?
For example, if BTC/USD are to slide down to $2 over the next month, it wouldn't be consider a profit even if you manage to double the amount of bitcoin we have.

The objective of the program is to maximize your BTC, not your USD.  If the exchange rate slides $2 over the next month, I will seek to be out of BTC and in USD.  By so doing, we will ultimately be preserving your buying power in whichever currency you chose to use, but that is secondary to our primary objective - maximize your BTC wealth.

[bitfoo]

What happens if I add/withdraw funds or even trade while you are at the trading phase? Just asking.

At this stage, I will more than likely just remove that account from participation until the next cycle.  If I have a position on and the account holder disagrees with it and sells out, at the end of the cycle, there could be a debate of who actually generated any profit or loss.

So, this means that I cannot add or withdraw BTC during a cycle right? I assume the length of a cycle depends on the market conditions? How long do you typically expect these cycles to last?

[bitfoo]

2.  The mimic part is run through a program created by a prominent developer in the bitcoin community.  Basically the software gets an account balance of all the individuals who are participating in the program and lets me know how much bitcoin or USD I'm trading.  When I enter a trade, it divides the quantity I am trading out to all the accounts which are participating based on a percentage ownership. 

Example - I have 3 customers.  Two customers have 10 bitcoin, and one has 100 bitcoin for a total of 120 bitcoin under management.  I enter a trade to sell 60 bitcoin.  The first two customers with 10 bitcoin each have an 8.33% stake while the large customer has an 83.33% stake.  My order is divided proportionately so the two customers each sell 5 bitcoin while the larger customer sells 50 bitcoin.  The percent gain or loss I make on this trade will be mimicked across every account.

Another question. If the amount you control across all accounts starts to become fairly large, the gains/losses experienced by each account will start showing differences, since you can't enter and exit the market at exactly the same price on all accounts (buying driving the price up, for example). Accounts where the order is placed first may have the advantage. How do you distribute this gain/loss across customers?

[FXTrader]

What happens if I add/withdraw funds or even trade while you are at the trading phase? Just asking.

At this stage, I will more than likely just remove that account from participation until the next cycle.  If I have a position on and the account holder disagrees with it and sells out, at the end of the cycle, there could be a debate of who actually generated any profit or loss.

So, this means that I cannot add or withdraw BTC during a cycle right? I assume the length of a cycle depends on the market conditions? How long do you typically expect these cycles to last?

Yes, I would highly prefer it if you did not add or withdraw during a cycle.  It is your BTC and you may do what you wish with your coin.  The issue for me is for profit and loss reporting.  If I make a trade and you disagree with my trade and exit out of it, at the end of the cycle there can be a debate as to who actually made the profit in your account.

A typical cycle will be about 1 week to 1 month.  It depends on the volume and volatility in the market.

[FXTrader]

2.  The mimic part is run through a program created by a prominent developer in the bitcoin community.  Basically the software gets an account balance of all the individuals who are participating in the program and lets me know how much bitcoin or USD I'm trading.  When I enter a trade, it divides the quantity I am trading out to all the accounts which are participating based on a percentage ownership. 

Example - I have 3 customers.  Two customers have 10 bitcoin, and one has 100 bitcoin for a total of 120 bitcoin under management.  I enter a trade to sell 60 bitcoin.  The first two customers with 10 bitcoin each have an 8.33% stake while the large customer has an 83.33% stake.  My order is divided proportionately so the two customers each sell 5 bitcoin while the larger customer sells 50 bitcoin.  The percent gain or loss I make on this trade will be mimicked across every account.

Another question. If the amount you control across all accounts starts to become fairly large, the gains/losses experienced by each account will start showing differences, since you can't enter and exit the market at exactly the same price on all accounts (buying driving the price up, for example). Accounts where the order is placed first may have the advantage. How do you distribute this gain/loss across customers?

My way of mitigating liquidity risk:
1.  My orders are broken among all the accounts.  If I say sell 1,000 bitcoin, every account will sell their share of the bitcoin depending on their share of the overall master account.
2.  Depth of market: I utilize the current depth of market to avoid price spikes and slippage.  If I sell 1,000 I ensure that there is sufficient liquidity to absorb my trade.

[bitfoo]

Signed up for the first cycle.

[Leandro César]

When the first cicle starts?

L.

[ineededausername]

Wait wait wait hold on.
How do we know you're not just going to take everyone's bitcoins and sell them at a low price to yourself or something?  I'm surprised everyone's so eager to join this group.

[FXTrader]

When the first cicle starts?

L.

The first cycle has begun.

[FXTrader]

Wait wait wait hold on.
How do we know you're not just going to take everyone's bitcoins and sell them at a low price to yourself or something?  I'm surprised everyone's so eager to join this group.

To directly answer your question: you have no way of knowing.  However, since I only earn a profit when you earn a profit, my interests are aligned with your interests.

[kjj]

Wait wait wait hold on.
How do we know you're not just going to take everyone's bitcoins and sell them at a low price to yourself or something?  I'm surprised everyone's so eager to join this group.

That's not how markets work.  He could sell them, but it would be to whoever has the best bid price.  So they only way he could sell them to himself is if he was paying the prevailing market rate.

[bitfoo]

What are your working (trading) hours like? 9-5, Monday to Friday? 24x7? Profitable opportunities could show up at any time in this market.

[FXTrader]

What are your working (trading) hours like? 9-5, Monday to Friday? 24x7? Profitable opportunities could show up at any time in this market.

I'm always looking for opportunities so I have an eye on it outside of a fixed schedule.

Profitable opportunities are almost always present but I don't chase them.  I try to only enter trades with a high probability of success.

[aq]

In the last few hours there was an easy recognizable 15% raise followed by a 10% fall.
http://bitcoincharts.com/charts/mtgoxUSD#rg2zvztgSzm1g10zm2g25zxzi1gMACDzi2gRSI
Why didn't you trade those?

[FXTrader]

In the last few hours there was an easy recognizable 15% raise followed by a 10% fall.
http://bitcoincharts.com/charts/mtgoxUSD#rg2zvztgSzm1g10zm2g25zxzi1gMACDzi2gRSI
Why didn't you trade those?

Timeframe, volume, and slippage.

[BitcoinRedLight]

Wait wait wait hold on.
How do we know you're not just going to take everyone's bitcoins and sell them at a low price to yourself or something?  I'm surprised everyone's so eager to join this group.

To directly answer your question: you have no way of knowing.  However, since I only earn a profit when you earn a profit, my interests are aligned with your interests.

A bigger picture is front-running and market-moving, as a function of volume.

This consortium is practically an inevitable phenomenon in the Bitcoin trade biz.

The need, always, is for healthy competition.

Otherwise it's just a game between market-moving and suckers.