Prett usual everying on those channel is for
educational purposes only and is not intended as Financial advice it is teaching Tech Tuesday let's
talk about different types of trading Styles and different types of trading strategies if you've
never been exposed to this stuff or if you're a newer Trader I think this is very valuable to
give you some idea of what other people are doing what other people's success might look like
if you've not done so hot here some ideas for you and want to try
if everybody has to find their
specific strength identify their weaknesses early on generally most people fresh to trading are
YOLO gambling basically right which is called scalping very low time frame take a lot of Trades
you know it's like it's a casino right typically this is high leverage lots of transaction fees
very active forcing traits is really what I see it as very quickly early on I I realized this
wasn't for me okay so very quickly early on I realized I want set and forget it I
want Trend
trading I want breakout trades I want to identify well in advance what my trading strategy would be
and I hope I illustrate that on the channel in the videos you know usually it's this is the decision
tree this is if this then that usually within the week at least I have some sort of viewpoint with
actionable items on what to do that help guide my own trading but what I'm not doing is going down
to the 15minute or the 5 minute right and looking at whatever I think even more peop
le probably fall
into the day trading category again probably high leverage maybe you know mix in options with this
as well derivatives Futures whatever not that there's anything wrong with any of this I just
think most people on average who are unsuccessful Traders would be much more successful if they
stuck to the right side of this table if they stuck to swing trading and position trading and
avoided scalping and day trading like the plague I feel a completely different mindset where you
are
you know you're relaxed you're moisturized you're unbothered right you're in your lane um things
can happen and it just doesn't matter I have a lot of discussions with people about stop losses
and do I move it here do I move it there what do you do when you sleep do you put it on the order
book I don't really worry about that stuff because I'm all the way over here right I'm so confident
in the types of breakout trades I take the types of trend trades I'm looking for I don't really
sw
eat massive leveraged positions that could go against me or get liquidated like that's just
not part of my system okay it's okay that that is part of your system if that is part of your
system but I'm just saying there's a different way to do things if you're on this high octane
roller coaster ride all the time I think a lot of us have a hotal stack which would qualify as
position Trading rarely active you know a lot of us have coins that we've held for a decade I'm
not going to say who but
there are some people who have held coins for a very long time right and
they have a number of mined and that number has not been hit yet and the investment thesis which
they may or may not have identified initially at the time is still very much active in playing
out and favorable to the hotal stack there's nothing to do there right again people think
you're a Trader there's there's always stuff to do I got to look at all these indicators and
listen to all these macro podcasts and it's fu
n it gets me through the day but rarely does you
know a macro analysts give me any action ability on the trading front looking at swing trading
that's recently probably where I've fit in a little bit more if you are on Leverage which a
lot of people are using leverage nothing wrong with that I find that uh swing trading waiting
for setups acting like a predator stalking its prey right I'm not desperate I'm hungry but I'm
not desperate and I'm just waiting for specific setups that I know hav
e a historically successful
risk reward profile that's it so there are some days most days probably where I do next to
nothing right I'm either in a position just letting it play out like I am now with this this
Bitcoin long or you're waiting for your setup to occur right Trend trading also probably within
the swing trading category higher time frame you're doing less you're letting the market come
to you you're not panicking about fomo trading you know you're either doing a mix of dollar c
ost
averaging you're doing a mix of moving bids around moving asks around fairly relaxed okay this this
all would qualify as active trading by the way versus passive trading but other considerations
would be how much time do I have if I have six kids and three wives I'm probably not going to
have a lot of time to stare at the screen Okay so keep that in mind because again I know people
who just like like to trade on the weekends or whatever and you know they pull up a chart on
the 5 minute
or the one minute and they think it's DraftKings that's fine look I these people
are part of the market I have nothing wrong with that if you're successful great in some respects
it's better that these people are unsuccessful for the successful people that's just what makes a
market but I'm telling you there's a better way to do things obviously risk plays a role here if you
are a day trader who in traditional markets just makes a little bit more sense but you know the
P pajama Traders oka
y where they buy the cloes and sell the open or you're trading only through
the day specifically and then at night you go net neutral you basically go to cash in after hours
or on holidays that doesn't really work for crypto because it's 247 but I know there again there are
a lot of people who do that and that's fine if that works for you great volatility also something
to consider here scalpers and day Traders will love volatility position Traders don't really
care uh swing Traders want vo
latility at spefic specific times when they want the volatility not
necessarily consistently but if you're actively trading volatility is generally what you're
seeking out you're generally seeking out large movements you can take advantage of something that
deserves this own video that I never talk about is the emotional psychological aspect of trading
I'll save that for a separate video but I know there are a lot of people who just cannot cannot
hold onto a loss cannot hold on to a win can
not sleep in a position cannot size up correctly uh or
appropriately based on the risk uh what else you find out who you really are when you start to gain
you know win or lose gain or lose a bunch of money okay to me emotionally there's no higher high and
no lower low in my life than trading just none Nothing Compares okay for a lot of us that's why
we're here because we get to feel something okay but there the emotional aspect is massive so if
you are a day trader or a scalper and you can'
t handle your emotions and you're just losing losing
losing slow it down okay just slow it down move to trading higher time frames have a massive hodal
bag right save yourself from yourself and just get out of your own way and let it let it take
course right if you're bullish on something and you believe in it for XYZ reason fundamental
technical or otherwise don't rely on the five minute to make those decisions on steering the
ship in a different direction it's also worth considering fees
and taxable events if if you're
on a tax advantaged account versus a non- tax advantaged account you know if you're trading on
a DEX or a centralized Exchange in crypto those are all taxable events if you're going in and out
of stable coins those are all taxable events if you're trading miners or mstr or coin and a Roth
right you may have a little different viewpoint on the market based on how active you trade
that and that's all the more reason to have these allocation buckets like I talk
about like
again for the most part crypto natives have have Hardware wallets they have a hodal stack whatever
right they have something that they don't want to lose on an exchange then a lot of people trade a
smaller percentage of the htal stack that they put on a centralized exchange or a DEX or a software
wallet right so you can walk and chew gum at the same time I'm not saying you shouldn't ever scalp
okay I I don't I just don't care because I feel like the uh risk reward there just isn'
t typically
where I want to be but to me the the risk uh is massive on the lower time frames and the risk is
considerably less on the high time frames I don't want to say easy mode on the high time frames
but if you're trading spot once a month twice a year I mean you're doing okay right there's enough
volatility in crypto or crypto equities or Legacy crypto or whatever where you can really really
take your time there with entries and exits if you want and just slow everything down half the
the reason why I doubled the cloud settings is to just slow everything down everybody's just way
too fast I'd rather have much slower signals that are generally correct have a higher hit rate than
worrying about uh lower time frame stuff so that's my soap box for for low time frame stuff this
is trading Styles this kind of mirrors trading strategies a little bit these are all hedge
fund strategies effectively globally including cry crypto most of this isn't applicable to crypto
most retai
l training crypto is effectively a long ownly hedge fund okay generally they or you or me
never short anything ever you're either in cash or you're fully deployed long right there's generally
not a mix of some sort of advanced strategy that is changing pretty significantly with the Advent
of defi with staking with reaking with f futes with options so we are getting a taste over the
past decade really of this this different type of stuff where it's not just all about directional
long short i
t's not even necessarily discretionary there's even passive stuff that mixed in there
but I think it's just important to take a broad view of what you could even be doing here right
because again if you're not great at the long side there there's other stuff you can do okay not
saying you should but there are other options lots of people they just stake and they hold crypto
that's great right that's basically a yielding risk strategy with some directional risk in there
the crypto hedge fund
slice fits into uh the niche strategy bucket there's commodity Traders credit
Equity event driven I'd say we are also a little bit event driven right when we're talking about
ETFs when we're talking about transitioning from proof of work to proof of stake when we're talking
about airdrops when we're talking about exchange listings I mean that's a different type of event
driven than they're referring to here but a lot of people that's what they're trading around is an
event right uh macro w
e're not really macro but we kind of are kind of getting more into macro uh
but realistically if you're a crypto hedge fund you're probably not doing any of the other things
and any of these other hedge funds probably aren't touching crypto and if they are they are like 10%
or less of global hedge funds this was data from coinbase from prequin as of last year and we
can see the a growth was pretty significant on a year-over-year basis from 21 to 2022 despite
2022 being as horrible as it was
right you can also see how small we were this isn't just crypto
by the way this is any Niche strategy but at that time how small crypto hedge funds were relative to
everybody else so we're just this this tiny baby relative to Global hedge funds equity strategies
that's a trillion it's probably way more than that now but compared to 62 billion at the time we
were nothing and then again back to this idea of crypto specific hedge fund strategies okay
many people are aware of what this stuff i
s but they may may not have seen like a name put on
it right so we have the liquid stuff which is easily bought and sold you don't have an issue for
instance going to exchange and selling anything in like the top 500 right Bitcoin eth whatever else
there are plenty of places you can sell that or buy that if you want to there are passive places
where you could DCA like River we have ETFs now we have Global etps there are funds and trusts
and pink sheets and all this other stuff all that stuf
f for the most part is liquid right you
have Arbitrage as well in there which is typically where something is cheaper in one place and more
expensive than another and you are the middleman taking the difference liquidity provision would be
defi in my mind and then the the IL liquid stuff is mainly Venture Capital Equity investing or a
mix of the two realistically over the past five to six years it's been early stage token investing
get the biggest slice as cheap as you can unlock that as fa
st as you can dump it on retail okay
that's why I do not like Crypt VC generally and I do not like any project that tries to dump
tokens on people for that exact reason because I know somebody bought that token for pennies on
the relative to what people are trading it on an exchange if we dig one slice down this is liquid
crypto fund strategies and again most of us are somewhere here most of us are long based long
biased event-driven I don't think most people I feel like have never actually
taken a short
in their life in crypto I mean most people are long only which is totally fine we've only been
realistically bearish for like 3 years out of 10 okay so like that makes more sense to be long
biased than have long short in your strategies but it's nice to know how to short when to short where
to short when when you get there right but if you're a terrible Trader and you love crypto right
you don't just want a hodle there's other stuff you can do right liquidity Market making de
fi
Market net neutral stable coin lending okay like you can go as net neutral risk down the Spectrum
not directionally anything as you want it's there it exists most people don't want that most people
want the risk and the volatility but folding that into the mix of your trading strategies might be
highly advantageous over the long run and tons of different ARB strategies which for the most part
retail isn't really participating in because those are generally uh more complex liquidity provi
sion
pretty easy for defi who's cashing carry trades for futures generally retail isn't Market making
either but just just to give you some sense of what's going on there from Trading Styles and
trading strategies If you're sort of looking around from is there something else I can do to
be successful or to improve my Edge or to think about this Market a little bit differently those
are your options there's there's tons of stuff you could do so the number of hedge funds per year
has general
ly followed price I don't have 2023 numbers here this isn't size of the Hedge this
is just the number my guess is is this is down uh probably pretty considerably as most fizzled out
in 2022 this is Galaxy digital's composite hedge fund index for crypto relative to bitcoin uh so
this is kind of important to look at if you are thinking about giving somebody money because if
they are not consistently outperforming Buy and Hold why bother right you're paying 2 and 20 or
one and 10 or 0 and 30 w
hatever it is for them to run your money when they you're better off just
buying holding right based on the index it looks like most hedge funds not worth it generally right
they may protect your downside but they certainly aren't going to give you room to run in months
like January and March 2023 when generally these hedge funds are out of position and I'm assuming
these hedge funds this year January and February are massively out of position trading a smaller
stack allows you to take more
risk allows you to do things a little loose that maybe somebody
with an investment committee wouldn't be able to do so keep that in mind but you'd obviously
want to compare the hedge fund you're talking to or investing with or whatever or yourself relative
to the index right again if you're not beating Buy and Hold what are you doing trading and if you're
beating crypto hedge funds then you're doing great right so if you're beating both that's where you
want to be which is statistically ve
ry hard to do this is Galaxy's uh data on sizes of these hedge
funds and again it's just interesting to see like are we growing are we shrinking what types of
strategies are seeing growth I don't have a great longer term look at performance relative to buy
and hold there's some charts out there that show you know net neutral strategies are great because
funding is generally high in crypto and there's always some place to provide liquidity looking at
AUM relative to that uh coinbase number i
n 2022 a kind of stuck in the mud here at 60-ish so we're
not really seeing a lot of pick up on the liquid crypto side of things which isn't terrible I
think at this point we're probably seeing the Venture stuff start to pick up a little bit From
the Ashes and we're starting to see trafi Legacy trade CM trade ETFs right so it's not going to be
a crypto native story anymore it's going to be a uh Global hedge fund story this is the Venture
part I'll talk about for two seconds um this is defi
llama's monthly raises for projects obviously
you can see you know FTX effect in here 2018 icos and we're still very much in the doldrums of the
VC bar Market it's hard to want to give people money as a VC if rates are as high as they are the
cost of capital increases significantly that puts increased pressure on VCS it's harder to raise
the money in the first place it's harder for them to deploy the capital to the correct projects to
make a return that's worth it but that's how it should b
e it should not be zero rates throw your
money at every zombie company or anything and see what sticks on the wall that's that generally
doesn't produce the best companies historically right so I would argue we actually don't want to
see the craziness we saw in 2021 2022 ever again clearly that didn't work out so well okay a lot
of this uh went to FTX yeah they're not around anymore right they were criminals they were doing
criminal activity if we look at the VC funding also just down signi
ficantly and again you can
see how crazy this got in the zero interest rate environment you get people throwing money at all
sorts of risky stuff and then it's the VC's job to go and find places to deploy this and so they
just find stuff right like it's not necessarily great projects that are getting funded it's just
there's so much money floating around the quality of the project is less important U but that is
down considerably in 2023 when you were seeing almost no raises whatsoever ever
from trafi
or crypto if we look back and we dial it back historically the best companies are always built
in the bare Market the best companies have always survived the bare Market that's why they say the
bare Market is for Builders kind of cringey but it's true very much survival the fittest with
these businesses and uh funding lastly let's just look at the uh Global change from 22 to 23
fund count down by half amount raised roughly down by half us fund count down down by a third
total r
aise down by a third and Global fund count down by a fifth with with total amount raised
down significantly okay so ideally the types of companies that emerge that are being built
now that are being funded now that are being discovered now and last year are significantly
better for the ecosystem than companies that have emerged in 2022 and 2021 and I mean I can
think of all these these web 3 companies that are just for sure going nowhere okay there's just
no chance that most of these make i
t over the long term so look if you're struggling with trading I
would identify a different trading style I would slow things down because I'm guessing if you're
struggling you're doing things too fast and then the rest sort of falls into place slowly over
time this takes time that's the other thing no one's a great Trader overnight everybody's got to
touch the stove and get burned everybody has to pay their tuition you're going to lose money
so don't trade your lunch money none of this is
financial advice that's all for this one like
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