What are Crypto Strategy Rules?
Let's start with a general definition of strategy: A detailed plan for achieving success in situations such as business, industry, or sport, or the skill of planning for such situations .
Up till now, Crypto Strategies could be managed with a single dimension - structure. Now we released a long-requested upgrade, Rules. Adding a secondary dimension to the table, Strategists can now really manifest their strategy with a combination of structure, templates, and rules.
How do Crypto Strategy Rules work?
- Templates first
To utilize rules, you first need to set up a good library of templates where each template represents a direct response you have in mind for a specific market scenario. For example, you could create two templates “Bull Template” and “Bear template”, where Bull Template goes all in and has zero stable coins weight, while bear template protects your investment and is very heavy on stable coins. Once you have the desired templates ready you may start to configure rules.
- Rule triggers
Each rule is triggered according to a fixed price by any of the ICONOMI assets (Crypto Strategies excluded), as defined by the user. This means, when you are creating the rule, you may select any of ICONOMI supported assets, for example Ethereum, and create a rule trigger when Ethereum reaches a specific price. Keep in mind that even though the UI provides helper buttons with percentages, each rule is still triggered upon fixed price as defined by a user, and does not monitor percentual changes of the asset.
- What happens when the asset trigger price is met?
When the chosen asset meets the price you set while creating the rule, automatic rebalance is triggered. Your Crypto Strategy will automatically start to rebalance to the target template with a selected algorithm (slow, medium, fast). Once the rule is triggered, it is automatically turned off, to prevent multiple rebalancing in case the asset price would be volatile around the price trigger point.
More importantly, once the rule is triggered we will also notify you via email and our new notification center, so we suggest you keep those notifications turned on.
- Rules trigger mechanics explained
For a rule to get triggered, the following parameters have to be met:
1. Rule price condition is met
2. Rule price condition is satisfied for at least 5 min
3. The 5 min timer resets to 0 in a case when:
- "Trigger below price" is set, and the price increases above the rule price condition
- "Trigger above price" is set, and the price decreases below the rule price condition
4. If the price oscillates around price condition, the condition timer might get reset to 0 several times, appearing as if rules are not triggering
5. To prevent several rule condition resets, please try experimenting with a little bit of "buffer" between obvious price resistance levels, where prices tend to oscillate a lot, resulting in unfavorable conditions to trigger the rule
- How do I control the rules?
In your Crypto Strategy view, you have a new tab called “Rules”. This is where you may create new rules, and see rules that are already applied to your Crypto Strategy. Each applied rule has a toggle switch button that allows you to turn the rule ON/OFF.
- What should you watch out for and why BETA?
You can set multiple rules per strategy, yet it is very important to understand how their price triggers overlap. If you set 2 different rules that both meet price triggers at the same time, both rules will be triggered and both rebalances will be applied without knowing which one will win. This may result in unwanted behavior so please be careful.
Currently, we are releasing Crypto Strategy Rules as the BETA version. This means that the feature is stable and tested, but we still need to monitor price triggers on a scale. Asset trigger prices are monitored by ICONOMI backend price fetchers. Price fetchers are field-tested and reliable, but there are still specific situations that may present themselves in the market, that would result in unwanted triggers (offline exchanges, incorrect price reporting by exchanges, etc).
Please find the information about adjusting the Crypto Strategy structure fee here.
And the information on how to create a Crypto Strategy here.