Categorize your investments and look at the long picture. In the process of your research, you’ll eventually realize you’re coming across a few different categories of coins. For some of them, you believe they have good teams, great vision, amazing publicity and a track record for successful execution. Great! Put these into medium or long-term holds and let them marinate into a delicious tenderloin. When the price dips, don’t even consider panic selling because anything in your medium or long-term portfolio should remain untouched for a set amount of time. BNB is a good example of a coin Miles considers a long hold. Recently, it dipped 20% for a while, and within our community, we witnessed some sell-offs to preserve investments. A week later, it jumped up almost 3x for a period of time.
On September 15, 2015, the Conference of State Bank Supervisors finalized their proposed model regulatory framework for state regulation of participants in “virtual currency activities.” The Conference of State Bank Supervisors proposed framework is a non-binding model and would have to be independently adopted, in sum or in part, by state legislatures or regulators on a case-by-case basis. In July 2017, the Uniform Law Commission (the “ULC”), a private body of lawyers and legal academics from the several U.S. states, voted to finalize and approve a uniform model state law for the regulation of virtual currency businesses, including bitcoin (the “Uniform Virtual Currency Act”). Having been approved by the ULC, the Uniform Virtual Currency Act now goes to each of the U.S. states and territories for their consideration and would have to be independently adopted, in sum or in part, by state legislatures or regulators on a case-by-case basis.
One traditional attraction of trading futures is the ability to use relatively small amounts of money to potentially achieve outsized returns. In many futures markets the margin, the amount of money that your broker requires up-front before executing the trade can be quite small compared to the ultimate value of the contract. For example, as of 22-Dec-2017, each E-mini S&P 500 contract was worth $134K ($50*S&P 500 index value)—this “list price” of the contract is called its notional value. The CME only requires you to maintain a minimum margin of $4.5K (3.4% of notional) to control this contract (brokers often require additional margin). Margin requirements this low are only possible because the volatility of the S&P 500 is well understood and your margin account balance is adjusted at the end of every trading day to account for the winnings or losses of the day. If your account balance falls below the margin minimum of $4.5K you’ll need to quickly add money to your account or your position will be summarily closed out by your broker. On the plus side, if you’ve predicted the S&P’s direction correctly your profits will be that same as if you completely owned the underlying stocks in the index. A +1% daily move in the S&P500 would yield $1340 in profit even though you only have $4500 invested— a 29% return—this multiplier effect is called leverage.
The tables below show performance examples of an UltraPro and UltraPro Short ProShares Fund that have investment objectives to correspond to three times (3x) and three times the inverse (-3x) of, respectively, the daily performance of an index. In the charts below, areas shaded lighter represent those scenarios where a Fund will return the same as or outperform (i.e., return more than) the index performance times the stated multiple in the Fund’s investment objective; conversely, areas shaded darker represent those scenarios where the Fund will underperform (i.e., return less than) the index performance times the stated multiple in the Fund’s investment objective.
Each Fund has adopted certain investment restrictions as fundamental policies that cannot be changed without a “vote of a majority of the outstanding voting securities” of the Fund. The phrase “majority of outstanding voting securities” is defined in the 1940 Act as the lesser of: (i) 67% or more of the shares of the Fund present at a duly-called meeting of shareholders, if the holders of more than 50% of the outstanding shares of the Fund are present or represented by proxy; or (ii) more than 50% of the outstanding shares of the Fund. (All policies of a Fund not specifically identified in this Statement of Additional Information or its Prospectus as fundamental may be changed without a vote of the shareholders of the Fund.) For purposes of the following limitations, all percentage limitations apply immediately after a purchase or initial investment.
Cboe Futures Exchange, LLC (CFE) launched trading in Cboe bitcoin futures at 5:00 p.m. Central Time on December 10 under the ticker symbol "XBT". XBT℠ futures are cash-settled contracts based on the Gemini's auction price for bitcoin, denominated in U.S. dollars. Gemini Trust Company, LLC (Gemini) is a digital asset exchange and custodian founded in 2014 that allows customers to buy, sell, and store digital assets such as bitcoin, and is subject to fiduciary obligations, capital reserve requirements, and banking compliance standards of the New York State Department of Financial Services.3
An Authorized Participant who exchanges securities for Creation Units generally will recognize a gain or a loss. The gain or loss will be equal to the difference between the market value of the Creation Units at the time and the sum of the exchanger’s aggregate basis in the securities surrendered plus the amount of cash paid for such Creation Units. An Authorized Participant who redeems Creation Units will generally recognize a gain or loss equal to the difference between the exchanger’s basis in the Creation Units and the sum of the aggregate market value of any securities received plus the amount of any cash received for such Creation Units. The IRS, however, may assert that a loss realized upon an exchange of securities for Creation Units cannot be deducted currently under the rules governing “wash sales,” or on the basis that there has been no significant change in economic position. Persons purchasing or redeeming Creation Units should consult their own tax advisors with respect to the tax treatment of any creation or redemption transaction.
Interest Rate Risk — The Fund intends to invest a substantial portion of its assets in U.S. Treasury securities and is subject to interest rate risk. Interest rate risk is the risk that debt securities may fluctuate in value due to changes in interest rates. Commonly, investments subject to interest rate risk will decrease in value when interest rates rise and increase in value when interest rates decline. The value of securities with longer maturities may fluctuate more in response to interest rate changes than securities with shorter maturities. A wide variety of factors can cause interest rates to rise (e.g., central bank monetary
You can find additional information about the Funds in the current Statement of Additional Information (“SAI”), dated October 1, 2017, as may be amended from time to time, which has been filed electronically with the Securities and Exchange Commission (“SEC”) and is incorporated by reference into, and is legally a part of, this Prospectus. A copy of the SAI is available, free of charge, online at ProShares.com. You may also receive a free copy of the SAI or make inquiries to ProShares by writing us at the address set forth above or calling us toll-free at the telephone number set forth above.
Unlike many commodity futures, Bitcoin futures are cash settled rather than physically settled. Cash settlement is a relatively new development in futures trading, first introduced in 1981 for Eurodollar futures, that addresses the problem of how to settle futures contracts on things that are difficult/impossible to deliver physicially—things like interest rates, large stock indexes (e.g., S&P 500), and volatility indexes (Cboe’s VIX). Futures physical settlement involves actual shipment/change of ownership of the underlying product to the contract holder but in practice, it’s rarely used (~2% of the time). Instead, most organizations that are using futures to hedge prices of future production/usage will make separate arrangements with suppliers/customers for physical delivery and just use the futures to protect against contrary price changes. In practice, the final settlement price of the contract can be used to provide the desired price protection regardless of whether the futures contract specifies physically delivery or cash-settlement.
BitMEX also has a weekly rebalancing for all their contracts, but currently their most popular product is the Daily 100x maximum leverage contract. This settles daily, but otherwise the rest of the contracts are handled on Friday, a little bit after OKCoin's 8:00AM UTC. See this website to get a countdown to the settlements on the different exchanges. The policies of exchanges are changing often so this information may be outdated by the time you read it (though we will try to keep it as up to date as possible).
Each Fund may invest in a wide range of fixed income securities, which may include foreign sovereign, sub-sovereign and supranational bonds, as well as any other obligations of any rating or maturity such as foreign and domestic investment grade corporate debt securities and lower-rated corporate debt securities (commonly known as “junk bonds”). Lower-rated or high yield debt securities include corporate high yield debt securities, zero-coupon securities, payment-in-kind securities, and STRIPS. Investment grade corporate bonds are those rated BBB or better by Standard & Poor’s Rating Group (“S&P”) or Baa or better by Moody’s Investor Services (“Moody’s”). Securities rated BBB by S&P are considered investment grade, but Moody’s considers securities rated Baa to have speculative characteristics. See Appendix A for a description of corporate bond ratings. The Funds may also invest in unrated securities.
The Fund is different from most exchange-traded funds in that it seeks inverse, or “short”, exposure. The Fund may not be suitable for all investors and should be used only by knowledgeable investors. Shareholders should actively manage and monitor their investments, as frequently as daily. As with any shorting strategy that is periodically rebalanced, the return of the Fund over time will likely differ from the inverse of the return of a similar static long investment.
Interest Rate Swaps. Interest rate swaps, in their most basic form, involve the exchange by a Fund with another party of their respective commitments to pay or receive interest. For example, a Fund might exchange its right to receive certain floating rate payments in exchange for another party’s right to receive fixed rate payments. Interest rate swaps can take a variety of other forms, such as agreements to pay the net differences between two different interest indexes or rates, even if the parties do not own the underlying instruments. Despite their differences in form, the function of interest rate swaps is generally the same: to increase or decrease a Fund’s exposure to long- or short-term interest rates. For example, a Fund may enter into a swap transaction to preserve a return or spread on a particular investment or a portion of its portfolio or to protect against any increase in the price of securities the Fund anticipates purchasing at a later date.
Each Fund bears all expenses of its operations other than those assumed by ProShare Advisors or the Administrator. Fund expenses include but are not limited to: the investment advisory fee; management services fee; administrative fees, index receipt agent fees, principal financial officer/treasurer services fees; compliance service fees, anti-money laundering administration fees; custodian and accounting fees and expenses, legal and auditing fees; securities valuation expenses; fidelity bonds and other insurance premiums; expenses of preparing and printing prospectuses, proxy statements, and shareholder reports and notices; registration fees and expenses; proxy and annual meeting expenses, if any; licensing fees; listing fees; all federal, state, and local taxes (including, without limitation, stamp, excise, income, and franchise taxes); organizational costs; and Independent Trustees’ fees and expenses.
The Fund pays transaction costs, such as commissions, when it buys and sells securities (including through the Subsidiary, as defined below), or “turns over” its portfolio. A higher portfolio turnover rate for the Fund or the Subsidiary may indicate higher transaction costs and may result in higher taxes when the Fund’s shares are held in a taxable account. These costs, which are not reflected in Annual Fund Operating Expenses or in the example above, affect the Fund’s performance. The Fund has not yet commenced operations as of the date of this Prospectus. Thus, no portfolio turnover information is provided for this Fund.
Some Centra investors have their doubts, and a plaintiffs' law firm has brought a class action complaint against Centra demanding the investors' money back. The complaint is fun -- Centra had a “Blog/Media Bounty” program to "Reward Experienced Writers who write quality Reviews, Articles About the Centra Project and the ICO crowdsale" -- but not that fun, because the plaintiffs' lawyers don't actually need to prove that Centra was a scam. Their job is much easier: All they need to do is prove that the tokens Centra sold in its initial coin offering were securities. If they were securities, they were sold illegally: They were offered publicly without being registered with the Securities and Exchange Commission, or being exempt from registration. And one remedy for the illegal sale of securities is that the buyers can demand their money back -- whether or not Centra is legitimate, whether or not it is actually using the money to build a cryptocurrency debit card, whether or not it made any misleading statements in the ICO.
I under-performed the market in 2017. A crypto market that went up several hundred percent and having read 24 books on finance and trading throughout the process, these were my biggest takeaways. Remember, these are notes I wrote to myself, so they may not work for your trading style. This version was summarized exclusively for CryptoMarket360 – a full version is hyperlinked at the bottom.
Note that the market value of the contract fluctuates before settlement. You are not forced to hold the contract to expiration. As the spot market moves, the traded futures contract price also moves. There is a live orderbook of traders placing buy and sell orders and you are able to realize your profit or loss prior to expiration, just as if you were buying and selling a stock.
Today’s article is all about the cryptocurrency trading strategy that you’ve probably been hearing so much about. There are tons of cryptocurrency trading strategies that promise to make you rich. Our team at Trading Strategy Guides understands that now everyone wants a piece of the pie and that is the reason why we have put together the best Bitcoin trading strategy PDF. We have also created a complete strategy article that has a list of all of the best trading strategies we have created.
Since you bought 68.4246 BTC, you want to short 68 BTC and lock in the USD value. You will have 0.4246 BTC left over, which will give you a slightly long bias. You can either fix this by only buying 68 BTC in step 1 or by giving yourself more short exposure by shorting 69 BTC. Remember that CryptoFacilities contracts are inverse (which allow locking in USD) and are denominated in BTC