If one becomes a#MEME diamond hand, what would the winning rate be?
How do those smart money in high-frequency trading make money without insider information?
I spent three days researching these two questions at home and summarized some trading ideas.
The odds of MEME are high enough, so the requirement for winning rate may not be as strict as everyone thinks. Since it's a game of probability, let's start by using the Kelly formula.
Taking an example of a high-frequency trading address with an average winning rate, but can continuously make big money:
This address (https://gmgn.ai/sol/address/DbC8yQX7kSzRAa6BuMeEyLaDWBo6PfdAGqgwWrMkZywJ…) has a habit of clearing positions, so the winning rate shown on gmgn is quite accurate. Although the 7D winning rate is only about 25.75%, the total profit over 7 days is more than 30,000. Minimizing losses when losing and maximizing gains when winning is the core of profitability.
Using the formula, it means to try to increase the odds as much as possible. If you want to make a profit at this winning rate, the odds must exceed 2.84. So how is this whale's 7-day odds data?
I did a simple statistical analysis with some tools, and his average loss per trade over 7 days was -242, while the average profit per trade was 1441, achieving odds of 5.9! No wonder he keeps making money.
Looking specifically at the 7D profit distribution, within 7 days, 9 coins (5%) achieved returns of over 5 times, which is crucial to ensure high odds; these 5% of coins played a key role.
Among these 5% of coins, Kleros achieved over 15 times, Koto around 23 times, QTL around 11 times, Kabbalah around 13 times, PEPAI and GAOT around 7.3 times, GFF and GMTR around 8.5 times, and Novus around 5.6 times.
Further analyzing the operations of smart money, I wanted to see how they achieved over 10 times, discovering some trading styles for everyone's reference:
1. Control the amount invested each time. 100u-2000u per coin, the amount invested will depend on the coin, but the average investment per coin is only $468.
2. This address knows how to play the internal market, so sometimes they can get chips at very low prices, which is key to increasing odds. Of course, there are many internal trades that haven't been executed. Everyone can practice and estimate their own winning rate. I personally play the internal market very rarely; everyone can look for internal market strategies online, but be careful not to over-leverage, or it will affect the dev chips, and people won't play with you.
3. After buying, they will hold slightly, observing for a while before deciding to sell or hold; this is also key to achieving high multiples, but sometimes it may miss the best selling opportunity.
4. When they receive coins with good sentiment, they choose to sell in batches, which is also key to achieving high returns.
5. If the situation is not right, be sure to exit; a major factor determining odds is also your loss amount. Commonly referenced indicators include: trading volume, changes in holding addresses, movements from key addresses (dev, smart money, cabal, front-line holdings, etc.), calling situations, and community enthusiasm.
