Day 5.1 - Coding Risk Management — Transcript

Full transcript

1. 0:01all right all right so let's get back to
2. 0:03coding and let's code some risk
3. 0:06management strategies so these are
4. 0:08actually going to be functions that I
5. 0:10used for risk management and the first
6. 0:14thing we'll need to do is we'll need to
7. 0:15connect to the actual exchange so I'm
8. 0:19just going to copy in all this
9. 0:20information
10. 0:22here copy it
11. 0:28and if you saw that I'll try to give you
12. 0:31some tricks here as well just throughout
13. 0:34command B will open up my sidebar
14. 0:36command B uh and if I hold down if I'm
15. 0:40up here selected and I hold down shift
16. 0:43and then select here it will select all
17. 0:44of them and then if I ever need to
18. 0:47indent something and I do that select
19. 0:50and then I shift and I select all of it
20. 0:52and then I hit command bracket left
21. 0:55bracket moves It To the Left Right
22. 0:57bracket moves it to the right so I
23. 0:59always appreciate uh these little tricks
24. 1:01as well so I'll try to as I do them I'll
25. 1:04I'll remember to remind you but remember
26. 1:07risk is everything so you want to make
27. 1:09sure to handle your risk accordingly and
28. 1:13I use just like a tiny percentage of my
29. 1:15trading portfolio in my accounts when
30. 1:17I'm testing and I don't scale that up
31. 1:20until you know it's it makes sense and
32. 1:24it's been forward tested for a long time
33. 1:26so I want to go ahead and show you a
34. 1:29couple functions here that are going to
35. 1:32go ahead and help you manage your risk
36. 1:35so the first thing is our kill switch
37. 1:37the kill switch is something that you
38. 1:39can call at any moment and it will take
39. 1:42you out of the
40. 1:43position so for example if you were in a
41. 1:46position
42. 1:48where you you had like a 10 contracts of
43. 1:52whatever you ethereum or whatever and
44. 1:57for whatever reason your Bot says hey
45. 2:01you know you need to get out of this
46. 2:03position maybe it's because your profit
47. 2:04and loss has been hit well the kill
48. 2:06switch is going to get you out of that
49. 2:08position now you can adjust this to be
50. 2:10your own uh this is just how I do it and
51. 2:13I'm going to bring in the code and from
52. 2:16there we're going to fix it up and you
53. 2:19can use it if you want but like I said
54. 2:21you know it's probably better that you
55. 2:24learn from it and then kind
56. 2:27of Do Your Own Thing
57. 2:31because it's not perfect I mean for me
58. 2:33it's perfect but hey it might not be
59. 2:35perfect for you so here here it is um
60. 2:38this is all the code let's go through it
61. 2:40I'm going to make this a little smaller
62. 2:42so you can read it I hope you can still
63. 2:45read
64. 2:46this I think you can um you can see it
65. 2:50it depends on a lot of stuff like open
66. 2:52positions so we're going to have to go
67. 2:53over quite a bit of stuff here in this
68. 2:55in this video but I'm just going to copy
69. 2:57paste everything and then I'm going to
70. 2:59put all of the code below as well so
71. 3:01we'll go line through line but I want to
72. 3:04get rid of all these errors first so
73. 3:06what I'm going to do is first off let's
74. 3:09make this screen so you can see the
75. 3:11whole all the code okay so you can see
76. 3:13the whole code and before I go through
77. 3:16all this I want to get rid of the errors
78. 3:17so I'm going to do that let's import
79. 3:20pandas this is one of the packages that
80. 3:23I highly recommend you study and master
81. 3:26we want to get our symbols in there
82. 3:30so let's just bring in all of this
83. 3:36information okay probably don't need to
84. 3:39fetch my balance right
85. 3:41now and so we have all the information
86. 3:43we need you can see these errors are
87. 3:46popping up here because the squiggly
88. 3:48lines and that's because this is calling
89. 3:50a function now this
90. 3:54function we have to create so let's go
91. 3:57ahead and create this function so you're
92. 3:58going to get a lot of good code here
93. 4:00from this this training um so buckle in
94. 4:03for sure because this is depend a lot of
95. 4:06this kill switch is dependent off of
96. 4:07other code which is dependent off of
97. 4:09other code which is dependent off of
98. 4:11other code right so let's go ahead and
99. 4:14bring in our open positions this is
100. 4:16another function that is super useful
101. 4:18because it shows you all of your open
102. 4:20positions so in order to the kill switch
103. 4:23we need the open positions so open
104. 4:27positions and I'll put all this code
105. 4:29below so don't worry um you can see that
106. 4:33it you need to pass in a symbol if you
107. 4:35don't pass in a symbol it's just going
108. 4:36to use the default symbol these things
109. 4:39will need to be changed and remember
110. 4:42that based on your exchange this part
111. 4:45might be different because your symbol
112. 4:48will be in different index positions so
113. 4:50you'll have to play around with
114. 4:53that you could actually just mark this
115. 4:55out too because this is kind of a custom
116. 4:58thing that I built
117. 5:00you can just put the index position up
118. 5:03here
119. 5:05index position equals whatever the index
120. 5:08position
121. 5:10is you can do it that way and just Mark
122. 5:13all of this out like that and by the way
123. 5:17to do that I hit command
124. 5:20backslash so select it all then command
125. 5:23black
126. 5:24backslash now this essentially this is
127. 5:27super important this is going to pull
128. 5:28all of your balance es all your balance
129. 5:30information for fex it was a little
130. 5:33different because I had to get the
131. 5:35balance information for USD because I'm
132. 5:37using the contract so it doesn't matter
133. 5:40if I'm trading like Solana or ethereum
134. 5:42or whatever it's actually trading USD
135. 5:45for those so this is going to be a
136. 5:46little different for each exchange but
137. 5:48essentially I fetch balance here and
138. 5:51then within the balance it's a
139. 5:53dictionary and I can get my open
140. 5:55positions by saying hey tap into that
141. 5:59femix balance and go to the info then
142. 6:01the data and then the position
143. 6:04section and then you can see this code
144. 6:07does something similar but it gets the
145. 6:10index position so that's what I said you
146. 6:13could hardcode up there but essentially
147. 6:15my index position for BTC is four so a
148. 6:19lot of my code actually just shows
149. 6:20instead of index position it will just
150. 6:22be like four like that so you can do it
151. 6:25either way and then it Taps into that
152. 6:28dictionary and looks at the side and
153. 6:31size dictionaries are super important to
154. 6:33get good
155. 6:35at if you're if you have like a list of
156. 6:37things you want to jot down to really
157. 6:39study dictionaries is definitely one of
158. 6:41them now this tells me if it if it's
159. 6:44long or short and if there's an open
160. 6:46position pretty much this is a if
161. 6:48statement and that's another really
162. 6:50great thing to be great at if
163. 6:53statements so drop that down and study
164. 6:55that for sure if you're not already
165. 6:57great at them um it's a little little
166. 6:59difficult right because a lot of people
167. 7:01already are Masters at coding and a lot
168. 7:03of people are better at coding than I am
169. 7:06and then there's some people watching
170. 7:08this that don't know how to code at all
171. 7:11so my my suggestion is just like
172. 7:13anything I say just study it and then
173. 7:16get different opinions remember my rule
174. 7:18of three three articles or three videos
175. 7:20and if you do that you're going to learn
176. 7:21your answer number one and then number
177. 7:24two through a million is you're going to
178. 7:26learn so much new stuff so here you can
179. 7:28see the open position positions it turns
180. 7:30the open position to true or false if it
181. 7:32shows buy or sell that means there's an
182. 7:34open position and then if it shows buy
183. 7:38the long equals true and long equals and
184. 7:41if it shows sell then long equals false
185. 7:43and then if it shows neither of them
186. 7:45then I just say none and false and then
187. 7:48this is just for my knowledge I print
188. 7:50out all this information so every time
189. 7:53it runs through I can see like what are
190. 7:55we in open position what's the index
191. 7:57position and then it returns all this
192. 8:00information and if I'm giving you
193. 8:02something to study how returning
194. 8:10Works in Python because essentially you
195. 8:13return all this information and then you
196. 8:14can use it so I'm returning open
197. 8:16positions open position bu open position
198. 8:19size long and index position and now I
199. 8:22can use my kill switch you can see my
200. 8:25kill switch takes in symbol as well and
201. 8:28if you don't
202. 8:30if you don't bring in a symbol then it's
203. 8:32just going to use the symbol that you
204. 8:35had set and then all of these I push put
205. 8:38in the symbol here to open position it
206. 8:40grabs my open
207. 8:42position then it tells me if I'm long or
208. 8:45not because remember I returned all that
209. 8:46information up here and then it shows me
210. 8:49the kill size I have to pass in the
211. 8:52symbol to all of
212. 8:55these and this is kind of set up
213. 8:58Advanced like you could could do it
214. 8:59without this you would just have to use
215. 9:01the symbol that you set up up here
216. 9:06right symbol equals ubtc
217. 9:09USD so my kill switch grabs all the
218. 9:12information it needs and then while open
219. 9:14position equals true meaning we have an
220. 9:18open position it's just going to Loop
221. 9:20and essentially Loop until it's finished
222. 9:23you don't need this data frame if you
223. 9:25don't want it but I just I use it
224. 9:28because you might need it in the future
225. 9:29but you definitely don't need it um and
226. 9:32then it cancels all open positions so
227. 9:35when I'm cancel when I'm trying to get
228. 9:38out of all positions I want to make sure
229. 9:39all orders are closed like I don't want
230. 9:41any open orders and then it it sees the
231. 9:44open position gets all the information
232. 9:46again gets the size it needs to kill
233. 9:48meaning you know when I first got it
234. 9:50started like I I actually wasted a lot
235. 9:52of money with this so I'm glad we're
236. 9:53going over this uh the kill size what I
237. 9:57used to do is say like okay I'm going to
238. 9:59open positions with like let's say 10
239. 10:02contracts of whatever and I would open
240. 10:05that position and then my kill function
241. 10:09would close 10 contracts as well but
242. 10:12what happened for the longest time
243. 10:15was sometimes when I open the position
244. 10:18maybe only eight of the 10 contracts
245. 10:20would fill so now I have a open position
246. 10:23of 10 or eight instead of 10 but my code
247. 10:27thinks it's 10 so for the long time I
248. 10:29just said okay in my kill switch let's
249. 10:32close the size that I opened so since my
250. 10:36code says 10 it tries to close 10 but
251. 10:39remember it only filled eight out of the
252. 10:4210 so I actually have an open position
253. 10:44of eight and it's closing 10 meaning I'm
254. 10:47going short too so this is going to save
255. 10:50you a lot a lot just to make sure to set
256. 10:54the kill size to the actual open size
257. 10:56and that's why I wanted to show you all
258. 10:57this information now the ask and the bid
259. 11:00to get out of the position I actually
260. 11:02want to get out as soon as possible but
261. 11:05I don't want to pay I don't want to be a
262. 11:07taker meaning I don't want to like with
263. 11:11fex or the exchanges I use like you have
264. 11:13to pay more in order to just take the
265. 11:16liquidity off the market meaning like I
266. 11:18don't want to wait for my my order to
267. 11:21fill I want to get it now well if you
268. 11:25want to do it that way
269. 11:27then then you're going to pay more so in
270. 11:31my case I always get the ask and the bid
271. 11:33so I can set the orders at the ask or
272. 11:35the bid and I get paid on fex to do that
273. 11:40opposed to having to pay so you can see
274. 11:42this calls another function so we're
275. 11:44actually going to have to bring in
276. 11:45another function up here and this
277. 11:47function is super helpful so you know
278. 11:51that's what I'm trying to do in this in
279. 11:52this training is just cut out the noise
280. 11:55and give you everything that's just that
281. 11:57I use in my dayto day so you can just
282. 12:01start from a place of of uh you know
283. 12:06experience so this is a function that
284. 12:08you'll probably need ask bid symbol
285. 12:11equals symbol if you don't add a symbol
286. 12:14uh in here it's just going to use your
287. 12:16one you set up top and then this it gets
288. 12:18the order book and then the bid it goes
289. 12:21through the order book and and reads the
290. 12:23dictionary and the bid is in this
291. 12:26placement and the ask is in this
292. 12:27placement and then I just print this out
293. 12:29to show what my ask and bid are or at
294. 12:33least my ask is and then F literal is
295. 12:36something that is super important so F
296. 12:41literal it allows you to put different
297. 12:45variables inside of sentences so I would
298. 12:48definitely go ahead and you know if
299. 12:49you're not really good with f literal go
300. 12:51learn about that a bit super simple to
301. 12:53use but it's like one of my favorite
302. 12:55things and then I again return the ask
303. 12:58and the bid and don't worry I'll put all
304. 13:00this code below um what I like to do
305. 13:02sometimes is I like to copy this or I
306. 13:05like to write here saying ask bid if I
307. 13:08if I ask for index zero it's actually
308. 13:11getting the ask if I ask for index one
309. 13:14it's getting the bid but now that we
310. 13:16have this we have our full kill switch
311. 13:19and it should work so it gets the ask in
312. 13:21the bid and then it says hey if the long
313. 13:23if we're in a long position then we
314. 13:26would want to get out of it
315. 13:29well I'm sorry this says long equals
316. 13:31false so that means we're in a short
317. 13:32position in order to get out of it we
318. 13:34need to create a limit by order right
319. 13:37because we're in a short position so we
320. 13:38have to buy it back and then you pass in
321. 13:40all the information I showed you in the
322. 13:42last video then I do a couple print
323. 13:44statements just for myself hey I just
324. 13:46made a buy to close now I'm going to
325. 13:48sleep for 30 seconds but else if I'm in
326. 13:52a long position equals true that means
327. 13:55I'm actually in a long position so I
328. 13:56need to get out of it with a sell order
329. 14:00and this is super important code
330. 14:02because your risk managing your risk is
331. 14:05everything and then I have an else
332. 14:06statement here that something that I
333. 14:09didn't expect happened in the kill
334. 14:10switch function and it will print that
335. 14:12out and let me know so yeah that's the
336. 14:15uh that's the kill switch for you and
337. 14:18that's going to be super super helpful I
338. 14:20think this video is getting a little
339. 14:22long I'll make sure to get the code down
340. 14:24down below and I will make a second
341. 14:26video for uh these next two things which
342. 14:29are super super important as well uh
343. 14:32they they kind of build off of the kill
344. 14:34switch that's why I had to show you the
345. 14:35kill switch first I'll make sure the
346. 14:37codes below let me know if you have any
347. 14:38questions and I I'll see you in the next
348. 14:40video