Hello everyone!
Today I want to talk about my experiment in spot trading. Perhaps some of you have wondered what would happen if you traded on the exchange relying solely on chance? That is, not paying attention to any market conditions, but simply randomly buying and selling. In fact, such cases already exist, even hamsters have been involved in trading.
But I was also curious. I don't have a hamster, but I do have Python... So...
Forget everything you know about trading! Technical analysis? Fundamental factors? Patterns, indicators, insider information? None of it matters!
All that matters is chance!
I created an algorithm to work through the Binance API. This algorithm created a market order with a random side (BUY or SELL) at random intervals (between 30 and 360 seconds), and a random percentage of available assets (between 20 and 80 percent).
But of course, I didn't want to risk real funds, so I ran this algorithm on testnet.binance.vision.
This is a sandbox for testing API tools. The market is virtually identical, but there are far fewer trading pairs.
The algorithm was executed for approximately 8 hours and during that time, it made 286 trades with the BTCBUSD pair. At the beginning, I had 3 199.45 BUSD.
At the end, almost all remaining BTC was sold, and as a result, I had 3 180.44 BUSD and 0.00005 BTC (just over 1 BUSD). That is, I lost 0.59% of my assets.
Despite loss my assets, it's not that much. Traders carefully weigh their decisions and take into account a range of factors, including technical and fundamental analysis, market trends, and more, and even then they can experience much greater losses.
However, it's important to note that relying solely on chance during trading is not a viable strategy, as it's very risky and can lead to significant losses.
This experiment serves as a reminder that there are no guarantees in trading and that even careful planning and research cannot protect against losses. Therefore, sufficient attention should be paid to money management.
