If you’ve ever been remotely connected to financial markets, be it traditional stock markets, global foreign exchange or crypto trading, then you’ve probably heard of the concept of arbitrage trading.
Arbitrage: when markets can’t keep up
In theory, when considering markets on a singular scale, there is one price for a commodity or asset. But in reality and in practice, there are hundreds of markets, if not thousands, at any given time, each with its own price, depending on many factors such as supply, demand, or even circumstance.
The price of an asset in a certain market is literally set by the market maker — the person or entity that creates an offer. And since there are so many factors that determine how that maker sets the price, the exact price of an asset varies from market to market.
And that sets the scene for arbitrage trading. Simply put, the term arbitrage, when used in finance and economics, is to take advantage of a difference in price between two or more markets. When a trader does arbitrage, he is simply buying the asset in a market at a lower price and simultaneously selling it in another market at a higher price.
Rare yet present: is crypto arbitrage possible?
In practice, arbitrage events don’t happen very frequently, as markets tend to balance out quickly to a global average price, and technology keeps improving to quickly snuff out such imbalances. Additionally, fees and commissions set by different platforms, when taken into account, cause prices to even out to the average.
But these opportunities still do exist, usually in very short frames of times, and savvy traders can jump in at the opportune moment, strike a matching deal combination, capitalizing on the imbalance and turning what is essentially guaranteed profit. Because of this, it’s no surprise that even today, the idea of being able to take advantage of arbitrage opportunities is very appealing to traders in all markets.
And in the crypto market, with technology still relatively new, and platform operators also yet to reach predictable standards, inefficiencies abound. But that’s music to the ears of arbitrage traders because, the greater the inefficiencies, the bigger the arbitrage potential.
BJF Trading Group’s VIP Crypto Arbitrage Software
However, to be able to take advantage of these small windows of opportunity, only the best, quickest, and most effective trading tools will succeed The crypto market, only about 10 years old, has wafer-thin volumes and limited width, meaning that arbitrage events are quickly snapped up.
This means that in today’s modern trading market for crypto, manual spotting of arbitrage events and human execution is simply not possible anymore because of the time limitations and the fine margin for error.
In essence, an automated tool must be able to enter arbitrage events in seconds and execute simultaneous trades near instantaneously. Fortunately, such a tool exists, thanks to almost two decades of expertise at BJF Trading Group.
Since 2000, BJF Trading Group has been developing some of the most successful algorithms for trading the foreign exchange (forex), finetuning every aspect of automated trading to build some of the most sophisticated tools for traders and enterprise customers available online.
BJF has painstakingly modified these tried and tested strategies to be used in the nascent cryptocurrency market, with years of live testing on exchanges feeding data continuously improving the model for crypto arbitrage.
The result is the VIP Crypto Arbitrage Software, the trading tool that monitors global crypto markets in real time, comparing quotes between exchanges and alerting traders to arbitrage events. And with most of the world’s leading global crypto exchanges covered, including GDAX, Kraken, Bitfinex, Bitstamp, Bitmex, Binance, Poloniex, Bittrex, Deribit, Okex, Cexio, Huobi, Hitbtc and many more, the BJF VIP Crypto Arbitrage Software ensures no opportunity slips by traders.
Whether an experienced trader or a novice starting out, this software is perfect for every type of trader. With every purchase, BJF provides free lifetime support and can install and adjust your own copy for traders on their own VPS. Don’t have a VPS? BJF can even point traders to trusted VPS providers with discounts!
- Comprehensive detail setting for hedging pairs. Set as many or as few parameters as needed, including difference to open/close, min/max profit, reverse trading, offset recalculations, dynamic close, slippage parameters, limit type and more!
- Special ultrafast connectors for MT4 allows traders to receive quotes and send orders faster than from MT4 terminal;
Ultrafast FIX API Engine allows to get the maximum execution speed;
- Trades executed via MT4 connectors appear to the broker as manual trading activity, not automated (Expert Advisors) trading;
- An application built on C# .NET, so it is possible to add extensions with 3rd party connection libraries that support .NET;
- Available FIX API Connectors: ADSS, CFH, CIRCLEMARKETS, CMC, CTRADER, CURRENEX, DUCASCOPY, FXCM, FIXIMARKETS, BJF, FXPIG, IB, LMAX, NEXUSPRIME, ONEZERO, PFD, PRICEMARKETS, PRIMEXM, SAXO, SMARTTRADE, SPOTEX, XENFIN;
- Supported Crypto exchanges: Gdax (Coinbase), Kraken, Bitfinex, Bitstamp, Bitmex, Binance, Poloniex, Bittrex, Deribit, Okex, Cexio, Huobi, Hitbtc, Cryptofacilities, Yobit, Sfox, Brasilbitcoin, NegocieCoins.
The BJF edge
BJF Trading Group has been developing proprietary solutions for traders and enterprise clients for online trading since the turn of the millennium, making them one of the most experienced and robust software providers in the industry.
Disclaimer: this is a paid-for, sponsored article. BJF Trading Group is the source of this content and is responsible for the content, and the accuracy of the content. Virtual currency is not legal tender, is not backed by the government, and accounts and value balances are not subject to consumer protections. This article is for informational purposes only. The information does not constitute investment advice or an offer to invest.
Image Courtesy: BJF Trading Group