In Superalgos, a trading system is designed to accumulate the base asset as defined in the trading session parameters. Because the base asset and quoted asset are defined at the level of the trading session, each strategy within a trading system shares the same base asset and the same quoted asset.
This means that all strategies within a trading system share the same goal: to accumulate the base asset. This also means that an individual strategy and all strategies within a trading system may either short or long one of the assets in the pair. A strategy can not do both things. It either shorts, or longs.
In Superalgos, you do not directly set up buy or sell orders to take a position. When taking a position, the system places a buy or a sell order depending on how the base asset and quoted asset parameters are set up in relation to how the market is listed at the exchange:
When the base asset in the parameters of the trading session matches the market base asset—that is, the base asset in the context of the market as listed by the exchange—Superalgos places a sell order to take a position, and a buy order to close a position.
When the base asset in the parameters of the trading session does not match the market base asset—that is, when the base asset is the market quoted asset instead—Superalgos places a buy order to take a position, and a sell order to close a position.
This may be confusing, as the similarity in the names of the concepts of base asset / market base asset, and quoted asset / market quoted asset is prone to some ambiguity.
Think of it in this manner:
Because the goal is always to accumulate the base asset, when the base asset in the trading session matches the market base asset, the system must place a sell order to sell the base asset, and rebuy it later with a buy order, hopefully at a cheaper price.
When the base asset in the trading session is the market quoted asset instead, then the system places a buy order to buy the market base asset, and a sell order to buy back the market quoted asset.
Let’s Try With an Example
For example, let’s assume the market is listed as BTC/USDT. In such a case, the market base asset is BTC and the market quoted asset is USDT.
Let’s say your trading system’s goal is to accumulate BTC.
- The above means that your base asset (at the level of the trading session) must be BTC and your quoted asset must be USDT.
It also means that the system will place a sell order when taking a position, and will place a buy order to close the trade.
Under such considerations, the formula of your stop loss in each strategy in the trading system should evaluate to a price above the take position rate, and the formula for your take profit target should evaluate to a price below the take position rate.
Now, let’s consider another example in the same BTC/USDT market. Let’s say you wish to stand on USDT and accumulate USDT, instead of BTC.
- The trading session base asset should be USDT, and the quoted asset should be BTC.
The system will place a buy order to take a position and a sell order to close a position.
You should set up the stop formula to evaluate to a price below the take position rate and your take profit formula to a price above the take position rate.