The CB005 strategy is designed to help users hold profits in Ethereum (ETH) by trading in inverse derivatives and swaps markets. This guide explains how the CB005 strategy operates, its key features, and important risk considerations.

The CB005 strategy utilizes your Ethereum (ETH) to engage in inverse derivatives and swaps markets. Its primary goal is to generate and settle profits directly in ETH, regardless of the market direction. This is achieved by programmatically executing long or short positions on contracts priced in USD, adapting to market trends.

The strategy is available during specific market cycles, generally from the BTC.D top until the BTC.D bottom and the other way around, applicable across all market conditions.

Here’s a breakdown of its core components:

The CB005 strategy offers specific parameters designed to manage trading activity and potential returns:

The CB005 strategy utilizes your held ETH to trade in inverse derivatives or swaps markets. It operates programmatically, buying (long) or selling (shorting) contracts. These contracts are priced in USD, but the system's objective is to settle profits in ETH.

When the price trends against the strategy's current direction, it will programmatically enter trades. It then aims to close these trades profitably when the trend reverses. This mechanism allows for the settlement of profits in ETH, regardless of whether the initial trade was a long or short position. This approach makes it a popular choice among clients for managing their Ethereum bots.

Important! When engaging with derivative strategies, users must be aware of the inherent risks. Due to the nature of convexity and leverage, there is a specific price point at which a position will be automatically liquidated. This event, known as a margin call, occurs unless additional margin is added to the account to maintain the position. This accounts for both the initial margin used and the effects of convexity.

At cryptobots.io, we prioritize a conservative approach to risk management. We limit the leverage used in the CB005 strategy to a maximum of 1.0x, despite exchanges offering up to 125x. This conservative leverage level is designed to provide approximately a 50% safety net, measured from the average buy/sell price, before a margin call would be triggered, and additional funds are required to maintain the position. For more details on risk, you might find our article Does the bot experience losses during trading? helpful.

Please note that Cryptobots does not offer investment advice, and users should understand the risks involved. Also, Cryptobots does not custody your funds.

To activate the CB005 strategy, you can use the following cryptocurrency exchanges:

If you are ready to register and explore the CB005 strategy, follow this link to cryptobots.io. You can also learn about our profit share model.