Trader Insights

Have you been successful in making $$$ using hummingbot?

Don’t eat the whole pie by yourself!

Please share strategies, config settings, or trading methods that have or have not worked well for you here.

** Disclaimer **

  1. Anything posted on this forum is NOT meant to be financial, legal, or tax advice.
  2. We are here to discuss trading strategies. Do NOT advertise a particular token.
  3. Unauthorized advertisements will be deleted and the user may be banned permanently.
  4. Please do your own research before investing in anything.

When I run the pure market making strategy for testing purposes, I’ve found that setting a wider spread so that the bot performs less than 100 trades/day is better than than tighter spreads that trade more often. Also, I typically use multiple orders mode with 2-3 levels and turn on the inventory skew feature.

For me, this usually results in positive performance after 24 hours of so, but YMMV.

3 Likes

Based on your testing does that setting work better in a more liquid market than a less liquid market?

Yes, those settings definitely help in more liquid markets.

For less liquid markets, they help as well but aren’t as necessary. In the next few releases, we’ll be adding more features that help market makers in less liquid markets soon, such as the ability to utilize a reference price from a different market.

1 Like

Some improvements that would improve my experience just with pure_market_making, which is all that I have experimented with thus far

    1. A module to choose the best markets to trade based on spread and volume. I know that I can get this manually from coingekko, but having a single module to highlight and flag up the >best< market pairs to trade at a particular time would be very helpful.
    1. Ability to change the fees according to discounts due to my (Binance or other exchange) Tier level or fee discounts (such as holding bnb etc). This was discussed yesterday on your support forum, along with a suggestion from ryan to directly edit the source code, and from mike to expose fee assumptions so that the user can modify them, but it always helps to re-emphasise this as some users may be less comfortable with recompiling from source
    1. For the cross MM strategy, one of the issues on the less liquid exchanges is knowing how large a position size can be taken (we have exactly the same problem, for example, in tri-arbitrage strategies) – it would be good if the strategy could automatically offer to suggest (or auto trade) at the highest position sizes that fit the depth and shapes of the order books. I recognise that this is a sophisticated requirement on a strategy, but we are talking about optimising returns, and whether I could place a $10 or a $10,000 position, which would grossly affect my absolute profitability, and seems to be a bot-level calculation that could be made in real time.
    1. My personal confidence in hummingbot would be greatly helped by introducing paper trading functionality. I won’t expose any significant funds to hummingbot unless I have an intuitive feel for how it works. I know that you have been saying for several months that this is on your planning horizon to introduce, and that it is a major change to make, so whilst recognising the difficulties and applauding your efforts, I want to just re-emphasise that this is >really< important to help adoption of hummingbot.
    1. When market pairs enter a trend, there are ways to trade this by asymmetrically placing the buys and sells, but given that traders have to occasionally sleep, it would be helpful to automate this. Perhaps this is a strategy that needs to be backtested on historical data to see how profitable/lossy it might be.
    1. Again, going down the auto-trading route, we know that alts generally retrace as BTC pumps, introducing a filter so that the bot (for alt market pairs) switches off for some time period under BTC pump or dump conditions would be helpful. Some bots, such as Moon Bot for example, allow quite sophisticated control of trading according to general market behaviour. Perhaps this is one step beyond your current development of Humminbot.

Having put these various suggestions up for discussion, we (user community) all recognise that hummingbot is an impressive piece of work in progress, and salute your initiative in developing this under an open source heading. Hopefully, comments like this will stimulate others in the community to bring forward similar (or better) ideas for discussion in this forum. Those that don’t ask, don’t get!

Best wishes to the humminbot dev team.

3 Likes

Please correct me if I’m wrong, the best orders in the book have higher chances of getting filled but the downside is I only get a small profit out of trades - is that right?

If I want to participate on bounty programs, is it better if I can make the bot trade more often even if I don’t get big profits because of the spread?

Based on the rewards for the Harmony ONE bounty program over the last 2 months, it has been more beneficial to trade more often at break even or a very small profit than to try and gain profit during the month. The rewards have been very generous and have covered my cloud hosting costs and the remainder being more than I believe I could have generated from the bot without the bounty program.

However, the rewards are subject to change and I expect that each bounty program will be different. You’ll need to DYOR for each bounty timeline in each bounty program.