Hello everyone, I'm Terry. I believe if you are watching BQ or using an exchange, you should have heard of the so-called grid transaction. Some time ago, a netizen shared with you on YouTube the result of the grid transaction. The conclusion is that the result of the grid transaction
and he can't even run against the most basic DCA strategy. He also said in the video that the grid is a low-revenue strategy. After this video came out, many other B-Band netizens like Nougat and MiaoMiao also made some responses. They also put some grid bills in their videos to prove that the grid can really make money.
I believe that if you watch these videos, you will be confused. Including myself, can the grid make money? Especially the price of Bitcoin has been in the upper and lower range of 100,000. So I want to make a special video today to clarify the grid strategy. Let you understand what the grid strategy is.
I will use the simplest and most basic math to show you. What is the best strategy for net grid strategy? Then you will know the principle behind net grid strategy. You will know when it is more suitable to open a net grid unit.
First of all, you need to know that the net-to-bill is a kind of quantification strategy. It is also the most intuitive and intuitive strategy in the quantification strategy. Because the underlying logic is very simple. Basically, it is based on low buy high sell. Then, all your buying and selling points are predicted in equal parts. Its operating principle is to trade with formulas, rules, and automated procedures. So this is why many exchanges call this strategy the robot strategy.
First, we need to understand the basic characteristics and parameters of the network grid. We will use the simplest and most basic BTC/USDT network grid. The first parameter is the price range. The price range allows you to set the highest and lowest line of the network grid. For example, the price of BTC is fluctuating between 80,000 and 130,000 USDT.
Then you can open a network with a minimum price of 80,000 and a maximum price of 130,000.
This means that if the price is over $80000 or if the price is over $130000, the grid will stop. This should be very clear and easy to understand. The second most important parameter is the grid number. This number determines the size of each grid between the price you just set. Let's use the example of $80000 to $130000. The total is $50000. If your grid is set to 100 grids,
The price of each grid is $50,000/100, which is $500. Okay, let's assume that when you open a deal, the price of Bitcoin is $100,000. Then every $500, the robot will use your USDT to buy a small part of the equivalent amount of Bitcoin. Similarly, if the price rises to $500, for example, it rises to $100,000,
The algorithm will automatically sell the corresponding amount of Bitcoin to do the transaction. So the more the number of blocks you have, the more frequent it will be. This should be easy to understand. The third factor is your investment value. The network block machine will calculate the amount of Bitcoin you should buy according to your investment value. For example, you have a total of 4 network blocks in this price range.
Let's use a very simple example. Your investment amount is 100 USDT. In this case, the robot will buy 50% of the amount of Bitcoin when you open the deal. That is 50U. The purpose of this is that if you open the deal, the price continues to go up two blocks and reaches the upper limit of the net. This trend has never given you any chance to buy.
The 50U Bitcoin you bought at the beginning will be distributed and sold according to the two attacks and then end this net net strategy Because the original investment is 100U, there are 4 blocks in total. If the price goes down after you open the order, if you do not fold one block down, the algorithm will automatically buy 25U Bitcoin to do an extra charge.
That's right, the grid strategy is that simple. If you are not sure if you understand it or not, let's simply simulate the actual operation of the grid strategy. I think you should understand it. OK, let's assume that we set a grid between 80,000 and 120,000 BTC. Then we also give it four grid lines.
Let's take a very simple example. Let's assume that the price of Bitcoin is 100,000 yuan when it opens. This parameter basically means that each price is 10,000 yuan. Suppose that our initial investment is 100U. Let's do an opening action. At the moment of opening, we call it T0. At T0, the price of Bitcoin is 100,000 yuan.
Because we have two up and two down, the robot will buy 50% of the investment, which is about 50U, into Bitcoin. At this time, your account will have 50U USDT and 50U Bitcoin. OK, when T1, if Bitcoin falls to 90,000, the robot will spend 25U to buy BTC again. Because at this time, we triggered the drop in the T1 grid.
At this time, your balance balance amount will be 25u USDT and the value is slightly lower than 25u BTC Because Bitcoin fell to $90000, the one we bought for $100000 before will be a little loss OK, if it's T2, Bitcoin has returned $100000
At this time, the robot will sell the BTC it just bought. At this time, your account will have a slightly higher than 50 USDT and a value of about 50 BTC. Because you have realized the first low buy high sell strategy. When you just fell to 90,000, you bought 25 UBTC.
Now it's $100,000 and the robot sold it. It's like a net profit and loss. Although you didn't make much money in the middle, you can already see that the next Bitcoin price is the same as when you started the business. If you were just holding the stock at that time, there is no profit now. But because you are opening a net today,
you will have a small part of the investment ratio is profit. OK, let's continue to look down. Suppose that when T3, Bitcoin rose to $110,000, the robot at this time will sell half of the Bitcoin balance. At this time, your account will have more than 75U USDT and value more than 25U Bitcoin.
If Bitcoin rose to $120,000 in T4, your network machine will help you sell your remaining BTC balance. Since Bitcoin has risen to $120,000, it has triggered the highest line set by the network you opened. At this time, your network strategy will end.
Let's see how much money you will have on your photo. At this time, your photo will have more than 100 USDT. This extra money is basically the ROI of your grid strategy. It's that simple. I hope you have a basic understanding of the grid here.
Now we are going to answer the most important question. Is the ROI we just earned from the net market more than the buy and hold? Let's take the example of the net market. If the net market is open, and the price of Bitcoin is 100,000 EUR, you bought a BTC for 100 yuan.
And then you wait until Bitcoin rises to $120,000 and then you sell your cash. You will earn 20U, which means your ROI is 20% of the cash. This increase is the same as the increase of Bitcoin. Now back to the grid strategy, I will now calculate for you how much the ROI of this grid will be.
When we open the T0, the front will have 50 U/USDT and 0.0005 BTC. At this time, the total value of your front is 100 U. At T1, because we use 25 U to buy, it is about 0.00027 BTC. At this time, the value of the front is about 95 U. If you are a buy and hold cash, the value of the front is only about 91.
Because you were buying and holding the whole box at that time. The net格 is part of the box to buy and hold. OK, now we are in T2. Bitcoin has returned 100,000. We are selling the Bitcoin we just bought. The value of the account will return to about 102.78U. I have already calculated it for you here.
If you are buying and holding, the value of the account will be 100U, there will be no change. Because the price of Bitcoin is exactly the same as the price you bought at the beginning. After we arrived at T3, we sold half of BTC. At this time, the new value of the online grid is 107.78U.
After T4, the net profit was sold out and the last BTC was sold out. The value of the front came to 110.28U. At this time, the net profit stopped. In other words, the net profit strategy gave us a 10.28% return rate. So it's not as good as the 20% return rate when we bought the whole warehouse.
I've also calculated for you guys If we use the cash-in DCA strategy today, the return is about 20.48% which is slightly better than cash-in I think this is why Bump's strategy in the video is far beyond the cash-in DCA strategy
Because the net net strategy is indeed not good enough to win the direct purchase of cash when the market is on the side of the line. Because the essence of net net strategy is to sacrifice the profit of this trend to exchange for passive profit of fluctuation. Another reason is that the net net strategy is not 100% of the money used.
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Of course, if the single-sided market is down today, the loss of the online market strategy will be less than the loss of the online market strategy. Does this mean that the online market strategy has no meaning at all? Of course not. Because as I just said, the online market strategy is really suitable for the market that is fluctuating and organizing.
Let's use the same parameter to verify it. When T0 opens, there will be 50 U USDT and 0.0005 BTC on the ledger. The value of the ledger is 100 U, just like before. Suppose that Bitcoin fell to $90,000 on T1. We will trigger the first purchase. After the purchase, there will be 25 U USDT and 0.00077 BTC left.
Ok, let's assume that when T2, Bitcoin rose to $80,000. We buy again. At this time, we have bought BTC in full. Then assume that when T3, Bitcoin rose to $90,000. Then the robot will sell the Bitcoin just bought.
At this time, there is already a part of the market share of profit. Ok, when T4, suppose Bitcoin rose to $100,000 At this time, the robot will take the Bitcoin bought at T1 and sell it. It means that this grid strategy has already spent two profits. Suppose we turn off this grid strategy now. Then sell the remaining BTC Because we never rose more than $100,000 So when T0, the market share is not profitable.
The final price is 105.9% which is about 5.9% of the return. In contrast, if you have a limited stock today, because the price of Bitcoin fell from 100,000 to 80,000 and finally rose to 100,000, and you didn't do any operations in the middle, your return is 0%.
In other words, we used the net gap strategy to show the advantage of price fluctuations and fluctuations to earn nearly 6% return rate. So when the price keeps on fluctuating, there will be a lot of purchase and sale profit. Therefore, there are a lot of mini-sales income. Just like the very simple example, we have a 5.9% profit. If the price fluctuates more and more today, its profit will be higher than 5.9%.
If the price of the order is returned to the price of the order, the cash flow will be zero. This is why people say that online shopping is suitable for encrypted currency. Because encrypted currency has been on the top and bottom for a long time. So online shopping strategy can actually make money. But the time to open the order and the time to hold the store is very important. And it needs to have enough up and down waves to generate effective revenue. Simply put, the longer the order, the higher the price fluctuates.
the higher the net profit. This is why you see many netizens on the Internet when they are selling their net profit, they have a longer opening and closing time. And the price range of net profit is also relatively large. Because this way, there is a greater opportunity to gain profit on net profit strategy. So overall, I think the most suitable time for net profit strategy is when the price is up and down. At this time, it can help you generate passive income.
When the trend is very obvious, you can choose to buy cash or some people choose to open a contract to maximize your income. So what you need to do is to choose the right strategy according to the trend. There is no strategy that you can make money or lose money. These strategies exist because of their purpose. It's just that the results of different people and different cognitive results are not the same. The number we just went to simulate is called cash grid.
After the price vibrates up and down, it will have a 5.9% profit. This profit basically depends on how many shares you have spent in this period of time. The longer the time, the higher the profit. Many people will think that each share is too small. They want to expand each share and expand the profit. So there is another network strategy called the contract network.
It uses the characteristics of permanent contracts to help you increase the profit of the upper and lower network grid. Another advantage of contract network grid is that you can choose to do more or do less. You can even choose a neutral network grid on OKEx.
It will use the price of your opening at that time as the standard If the price is higher than the standard, it will be empty And if it's lower than the standard, it will be more The purpose is to make you more effective Let you go bigger To brush the profit of this price up and down Of course, the contract is like any contract It's likely to go bankrupt
Because you are using the leverage to expand your funds to brush the net profit Naturally, its return is high, the risk will be higher If you are interested in net strategy, you can try the net strategy of OKX In fact, the main reason why I use OKX is that they are perfect in addition to the net strategy I think the best and the most amazing thing is that this is the whole net OKX has While you are brushing the net, your funds can also automatically earn interest That is, OKX has an automatic currency function
It will directly combine with the grid so that your funds will not stop when you rest. This combination can also make up for the disadvantage of the grid not being used in the capital rate. And OKEx also has the function of moving grid. That is, the grid price range will be moved up and down according to the current market price.
This way, I can use the advantage of the grid more flexibly. This strategy is similar to the research article I read before. The research on it is to prove that you can run a life-saving feedback study using dynamic grid. I think the research is quite interesting. If you are interested, please leave a message below the video. I can make another video to talk about the research paper in depth.
I will put the details of the operation of OKEx and all the basic knowledge in a video on my website. I will put the link in the information bar at the bottom of the video. After you have registered for the entry, there is a menu in the upper left corner of the app. After you click in, you can find the strategy transaction below. Here you can choose the cash or contract network. There are also some other trading strategies that are often used. Here we choose the cash network.
You can choose AI strategy here. This is to provide you with some predicted grid parameters based on historical feedback data. Then you can see how much the historical annualization benefit of this parameter is. Of course, you can also choose to create and adjust the parameters yourself. Here, as I just said, the first one is the price range. For example, I want to set 6 to 120,000. Then I can set the number of grid. Here, let's say we set 100 grid.
Next, choose the amount of investment you want to invest. Another advantage of OKEx is that you can choose the "revenue return" function. In other words, the profits you earn in the grid will continue to be invested in grid funds. You can see that the automatic currency transfer function is activated. This is the function that OKEx provides additional automatic interest.
In the advanced settings, you can also choose to change the network grid to move up or down with the price. This is like turning the network grid into a semi-movement mode. You can also set a price for the start condition and the network grid trigger. The price means that the network grid strategy will start only when the price reaches this price. The easiest operation of the network grid strategy is probably like this.
In addition, OKEx has prepared a new user benefit for the netizens of this video. After the video is posted, you can get free net-bid activities within a month. So if you haven't registered with me, please use the link below the video to register. I hope this video is helpful to you, especially those who are interested in netbid strategy. Because I haven't seen any resources on the Internet yet to calculate the number of netbid strategies so clearly.
If you like this video, please give me a thumbs up. See you next time.
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