Silk Road forums

Discussion => Silk Road discussion => Topic started by: Yama Dass on November 26, 2012, 03:47 pm

Title: attn vendors: To hedge or not to hedge?
Post by: Yama Dass on November 26, 2012, 03:47 pm
With the reward block halving rapidly approaching, most bitcoin speculators are predicting a rise in value. As a vendor do you think now would be a good time to go unhedged? It seems to almost be a given that prices will go up. Then again, there is a possibilty that speculation has already been factored in the current price as the market has had ample time to prepare for the halving.

I predict there will be a swing of wild trades immediately before and after the halving and btc will reach $15+. After a few days it will level off again near its current price. Hopefully my unhedged coins are released from escrow near the peak so I can take advantage of the swing. If anyone is planning to order anything this weekend I would buy my coins now just in case.

Title: Re: attn vendors: To hedge or not to hedge?
Post by: eddiethegun on November 26, 2012, 06:31 pm
I never hedge. You'll always lose money if the price hasn't dropped at least 4%. That's about $0.50 right now. Certainly possible but I'm betting against it. Use auto-withdraw instead and post a bid for at least +1% Last price, to cover the fees. There's enough fluctuation in the price that it always sells within a few days max.
Title: Re: attn vendors: To hedge or not to hedge?
Post by: Yama Dass on November 27, 2012, 01:15 am
I never hedge. You'll always lose money if the price hasn't dropped at least 4%. That's about $0.50 right now. Certainly possible but I'm betting against it. Use auto-withdraw instead and post a bid for at least +1% Last price, to cover the fees. There's enough fluctuation in the price that it always sells within a few days max.

You're right, you can only lose money if the price drops more than $0.50. I don't understand why more people prefer to hedge.

Which exchange do you use? Do you auto withdraw directly to the exchange or an intermediary wallet first?

Title: Re: attn vendors: To hedge or not to hedge?
Post by: blowdrobro on November 27, 2012, 01:31 am
I never hedge. You'll always lose money if the price hasn't dropped at least 4%. That's about $0.50 right now. Certainly possible but I'm betting against it. Use auto-withdraw instead and post a bid for at least +1% Last price, to cover the fees. There's enough fluctuation in the price that it always sells within a few days max.
this dude knows what he's talking about.
Title: Re: attn vendors: To hedge or not to hedge?
Post by: pPharm on November 27, 2012, 03:17 am
Didn't the price of bitcoins just drop by 50 cents or so in the past day or 2?
Title: Re: attn vendors: To hedge or not to hedge?
Post by: eddiethegun on November 27, 2012, 03:35 am
I never hedge. You'll always lose money if the price hasn't dropped at least 4%. That's about $0.50 right now. Certainly possible but I'm betting against it. Use auto-withdraw instead and post a bid for at least +1% Last price, to cover the fees. There's enough fluctuation in the price that it always sells within a few days max.

You're right, you can only lose money if the price drops more than $0.50. I don't understand why more people prefer to hedge.

Which exchange do you use? Do you auto withdraw directly to the exchange or an intermediary wallet first?

I withdraw to an intermediary wallet. Just don't know how much blockchain analysis the exchanges might do. Best not to take chances.
Title: Re: attn vendors: To hedge or not to hedge?
Post by: anseladams on November 27, 2012, 03:52 pm
How much is the fee for hedging? Something I've always wondered.
Title: Re: attn vendors: To hedge or not to hedge?
Post by: danknugsdun on November 27, 2012, 04:57 pm
How much is the fee for hedging? Something I've always wondered.

4%
Title: Re: attn vendors: To hedge or not to hedge?
Post by: anseladams on November 27, 2012, 07:00 pm
I i figured, thanks.
Title: Re: attn vendors: To hedge or not to hedge?
Post by: eddiethegun on November 27, 2012, 09:06 pm
Didn't the price of bitcoins just drop by 50 cents or so in the past day or 2?

It fluctuates. At the moment it's up about 3% from this time 10 days ago.