HELP — TRADING ETN ON AN EXCHANGE
Question: Let’s say I buy ETN for $1 (which equals 1 btc) and I place a sell order for $2 (which equals 2 btc). So I’m trying to double my money.
Let’s say the price of btc doubles by the time the order is filled. If the price of btc doubles then I’m going to more than double my money when the order is filled.
In this scenario, do I need to go back in and manually lower the price of my sell order to keep the same profit margin of doubling my money? In this particular example, I would have to lower my sell price by half (sell for .5 BTC) to double my money since the price of 1 btc went from $1 to $2.
Do I need to adjust my sell order manually or does the exchange automatically adjust for this?
From my Understanding of your Question you are talking about FIAT (Paper Money) Values.
First thing i recommend you read up on is “Satoshis” or “Sats” and how they are relevant in an Exchange.
Unless you are trading a FIAT Pairing you won’t be placing any Sell Orders in Dollar/Cents Value. You set your Sell Orders in Satoshi Value. If you Buy ETN at 280 Sats (Current Price) and you buy 1 BTC worth, then when ETN’s Value in Satoshis goes up to 560 Sats you have basically Doubled your initial Bitcoin Investment and if you were to sell all your Coins at 560 Sats you would have 2 Bitcoin.
ALSO:
If bitcoin was £6000 when you bought it, and it went up to £12000 by the time you cashed out, so to speak then your initial Investment has actually went up 4X!
ETN Doubled your BTC Return, and also BTC price Doubled which then multiplied your FIAT Value by a further 2X.
Hopefully this makes Scense, if not please feel free to PM me and i will be happy to walk/talk you through it again.
1 Like
It’s true. In my example, I would be making 4x my money if bought in at 1btc and the price of btc doubled by the time my sell order got filled – 2 btc DIVIDED by .5 btc. 2 BTC is the doubling of the BTC price and .5 BTC is what my purchase price EFFECTIVELY became after BTC doubled.
What’s confusing me a bit is that I think is dollar values not Satoshis. So let’s say I buy ETN at $1 and I want to sell at $2. What I do is find the BTC equivalent (or Satoshi equivalent) of $2 at the time and that’s what I enter as my sale price. Am I doing this correctly?
Do you have a good rule of thumb I can use to calculate what my sell price should be to get the return I’m looking for?
ColinSTE
Professor
November 6
First thing i recommend you read up on is “Satoshis” or “Sats” and how they are relevant in an Exchange.
Unless you are trading a FIAT Pairing you won’t be placing any Sell Orders in Dollar/Cents Value. You set your Sell Orders in Satoshi Value. If you Buy ETN at 280 Sats (Current Price) and you buy 1 BTC worth, then when ETN’s Value in Satoshis goes up to 560 Sats you have basically Doubled your initial Bitcoin Investment and if you were to sell all your Coins at 560 Sats you would have 2 Bitcoin.
ALSO:
If bitcoin was £6000 when you bought it, and it went up to £12000 by the time you cashed out, so to speak then your initial Investment has actually went up 4X!
ETN Doubled your BTC Return, and also BTC price Doubled which then multiplied your FIAT Value by a further 2X.
Hopefully this makes Scense, if not please feel free to PM me and i will be happy to walk/talk you through it again.
You are sort of looking at it in the wrong way, though your logic makes perfect sense.
If you are looking to plop some money down and set up an auto collect after it doubles or quadruples etc, id recommend going to the Casino instead. What you would be basically doing is just Gambling.
Bitcoin price swings quite wildly, and so does other Cryptos, including ETN. For example Bitcoin may go up and ETN satoshi value go down, then Bitcoin go down but ETN Sats go up. They move interdependently from one another. Although they generally move in tandem in FIAT value due to BTC sats being worth more/less as BTC rises or falls.
I think the question you need to ask yourself is: Do you trust that Bitcoin is going to go UP in value? If YES forget about this for now and worry only about satoshis/sats.
Whatever your buy in price (currently around 280 sats) any rise from here will generate you a higher amount of BTC when you sell. If you trust BTC to rise, this is all you need to worry about.
My personal advice (not professional advice) is Not to try be a trader unless you REALLY know what your doing, there are bots that eat people like you for breakfast. If you believe in a Coin such as ETN, invest what you can afford, and hold onto it for a long time and sell it when your coins are worth a combined total of whatever your goal is.
Don’t buy coins then place a sell order at a pre-determined rate. Buy them, then store them, then move back from storage to the Exchange when you have £XXXXXX <----- whatever your target is.
1 Like
Do you have a particular You Tube video or other info. that you recommend so I can study up on this more ?
Thanks
Victor
