Explore investment strategies in Open Finance through a trading simulator.
|Sep 18 at 5:17 pm||Public post|
I’m excited to share another educational resource that I’ve been working on to compliment DeFi product tutorials: DeFi Strategies.
Combining available DeFi products, DeFi Strategies helps you explore investment opportunities in Open Finance through hypothetical scenarios. See how your Gain/Loss could change with each strategy given different investment parameters (i.e. your hypothetical investment amount, forecasted ETH price, investment period, etc.)
Here’s how it works:
Browse available investment strategies. I’m starting out with 3 basic strategies focused on Aggressive/Moderate/Conservative ETH growth and will be adding more as product tutorials are released. Each strategy consists of different ETH trade positions and how much of your investment would be allocated to each position. For example, Moderate strategy recommends you allocate 50% of your invested amount to ETH Long 2X Leverage position, 25% to purchasing ETH 20 Day Moving Average TokenSet and 25% to generating interest with cDai. You can click on each trade allocation to view available DeFi products and tutorials to execute selected trade.
Right below trade allocations section, see what your asset exposure would look like if you invested $X amount using a particular strategy. For example, if current price of ETH is $200 and you invested $10,000 using Moderate ETH strategy, your resulting asset exposure would be 2,500 cDai (25% allocation to interest generation) and 50 ETH (25 ETH from 50% TokenSets allocation and 25 ETH from 20% allocation to 2X leverage position). You can change your hypothetical investment amount by clicking edit icon on top right.
Next, see what your Gain/Loss would look like and how much interest would accrue if price of ETH reached $X amount within X number of days. You can edit your forecasted ETH price, leverage amount, interest rates and trade duration to see how they effect your Gain/Loss.
Keep in mind this is a MVP. I’m starting out with very basic strategies and parameters to play around with. Many UI changes to come based on your feedback so keep it coming!
Features I’m thinking of adding soon:
- Execute and manage multiple strategy trades in one 'bundled' transaction.
- More details on product pages, highlighting risks, comparing interest rates, liquidation price levels, and price slipages.
- Live product stats. Things like current lend/borrow interest rates for quick comparison.
- Compare Gains/Losses between investment strategies.
- Additional paramaters to simulate Gains/Losses.
- More interactive charts and explantions.
- Ability to create your own strategy.
- DeFi Glossary tab.
What would you like to see? Please let me know and I will add it.
If there's enough interest, DeFi Strategies will enable asset management tools that use a combination of Set, Compound, bZx and other applicable protocols to help end-users manage and execute strategy trades bundled as one transaction.
Furthermore, if there's enough demand after V1 for risk management tools, DeFi Strategies will implement Hedger which I am currently researching.
Hedger is a system of smart contracts that will allow anyone to write and settle covered options on Ethereum. Using Hedger, anyone will be able to insure their collateral against liquidation losses in case of unexpected market downturns. Premium rates incentivize liquidity providers to underwrite options and provide an alternative income to lending. Purchased options are 'tokenized' to keep track of buyers’ portions and can be traded on 3rd party exchanges like any other token. Writers' collateral is held in escrow in smart contracts and released to option token holders if exercised or returned to writers if expired.
Big questions right now are how to (1) price premium rates and (2) source liquidity. Ideal solution will involve a general liquidity pool (not P2P matching) with algorithmically derived premium rates based on demand for a particular strike/expiration combination.
DeFi Strategies is available by invite only for now. Get access by filing out a form here: https://defistrategies.com