Date : 20 October 2021
Time : 12:00 PM UTC
Guest : Mr. Paul ( Head of Huobi Derivatives Warrant)
Venue : https://t.me/Crypto_Talkzs
Host : 👋Hello Chat , Welcome to another exclusive Crypto Talkz AMA❤️
Today with us, we have Houbi Derivatives Warrant❤️
Hello and welcome to our community, I’m glad you here to join the AMA today! @optionmmaker 🙂
Mr. Paul : my great pleasure to share with everyone tonight
Should we begin now?
Host : Before we proceed, please introduce yourself to our community @optionmmaker 🙂
Mr. Paul : Yes! I was a Portfolio manager for a mutual fund and have 10 years derivative trading experience. Now i become a crypto enthusiast trying to build various tools for crypto world
1️⃣ Introduction Segment
Host : We want know what is Derivatives Warrants & Why do we need to have Derivatives Warrants?
Mr. Paul : You can see Derivative warrants as a way to trade options.
First of all, an option is an awesome tool to create various strategies which can’t be replaced by futures, we have now a big option market in the crypto world. We still find there is good space to advance the product in the market.
a)We found the format of exchange traded option is difficult for our clients to understand. We designed a more concise way to present options to suit their needs.
b)After we pact our product, we found we can sell the Derivatives Warrant cheaper compared with other exchange traded options.
c)Our clients need more flexible ways to trade options, they need touch option, barrier option, American option. Sometimes they want options with the specifics which can’t be found on an exchange, we offer more flexibility.
Host : Great idea! Then, How should we understand Derivatives Warrant premium?
It’s like option premium, for our American option, you can regard it as a sunk cost or a cost in exchange for insurance. option is right to buy/sell at a contracted price. U can buy a right to buy 1btc @40000, if price up to 41000, profit 1000, and maybe the option will cost u 200.If price fell, u lost 200 at most, no LIQUIDATION before it expire.
You can still realize the profit conveniently. For our European option, there is more flexibility. The price of option goes in the same way as underlying asset and with nice leverage and without the risk of liquidation.
Host : And Why Derivatives Warrant can be a cheaper way to trade than other option?
- If you have trade options before, you will find that exchange charge you at least two fees: commission, settlement fee.
- It’s the legacy issue before we have electronic trading
- We dont charge that at our product
- Another way it can be cheaper is if you buy a spread from us, you only need to pay the spread and commission one time, rather than twice if you create it at the exchange by yourself. We don’t charge settlement fees now, so the total cost can be much cheaper.
Host : When can we have Derivatives Warrant as a more effective way to trade?
- It covers a lot of unique situations. For example, you can trade a small range bound with our spread. You can bet on a big rally without worrying about the liquidation. When you belive there is no a trend in the market, you can profit with touch option. It’s so versatile!
- Even when you want to bet the trend, you buy an option, you can get extra leverage with gamma
- It’s irreplacible
2️⃣ Twitter Segment
Q1. Can you explain simply what the Houbi Derivatives Warrant is aiming for? Is your project currently complete and what are the difficulties that Houbi Derivatives Warrant is facing? Can you share some of the achievements that Houbi Derivatives Warrant has achieved?
We are aiming for providing awesome trading tools for people in crypto world. Our project has advanced in good direction as we will lauch the FIRST touch option in industry recently. We will keep creating innovative risk management to serve the industry.
Q2. I see that you will be launching the touch option this month. Can you explain more about it? What are the advantages of this option for users? Are clients always able to trade based on trends or reversals?
- It’s an very interesting option as you can trade your view freely. For example, you believe btc will touch 70k within next week and you want bet with good leverage. You may find you cant do it with futures or european. But with touch option, you can simpliy chech the touch option with 70k strike and buy it directly
- It’s more than simply trade on trends or reversals, give more dimensions to trade
Q3.Trading nowadays are risky and it oftens consume all our funds with all the risk. So can you tell us more about your trading options? Does Huobi Derivatives Warrant have a safer way for the traditional trading? What makes you outstandingly unique among other trading services?
- Option is a risk management. Position management is alway the core issue for trading. Trading with warrant can be safer as you wont be liquidated. For example, if you enter a 3X long position of btc on May 19th and the price collapse on that day, you will be liquidated. But if you have an american option, you wont be liquidated and price recovered soon
- you can gain on price volatility by paying reasonalbe option premium.
Q4. Doing some research on your platform I had some questions. So, can you explain what is the difference between warrant and perpetual swap? How can we choose between the American option and the European option? And when is the best time to use either of these two options?
- Sometime you can trade a Derivatives Warrant as a leveraged position, a perpetual that won’t be liquidated regardless of price volatility. If you get some edge at market, you need to pay something. The advantage of no liquidation comes at price of premium. If you wanna pay to have a sleep, American option is a good choice.
You can get a good idea from this page. If you have concern on liquidity, American option is a better choice. If you wanna exit your position when the movement cool down, european option is good.
Q5. I’ve heard that here at #Huobi, you aren’t charging any transaction fees for NOW? This is great, so can I ask the reason why? And does it mean too that in the future this NO FEES will change? If so, may we know your plans on this?
- We dont need to charge the unnecessary fees from our client as certain service do not cost us like the we dont charge settlement fee
- we only charge commission from our market maker
- As we want to make our product as simple as possible for our client
- We have no plan to change it
3️⃣ Telegram Live Q&A Segment
Q.What are the plans to educate and raise awareness and adoption among the community to make more people understand about your project easily (even for beginners)?
We do put a lot of effort into it when we come up with the product design. We make simplied american option and touch options, and first doge option in industry. but we do have the ability to serve professional traders, if you want to purchase a large amout, you can also contact me.
Q.How easy is it to use your platform
Is there any need for KYC before accessing your HUOBI ?
Yes, you need kyc for huobi. We try to make it as simple as possible
Q.I talked to some members of your community on telegram to understand how American and European options work, and it’s a bit complicated when you trade American options. So, your platform could you make some kind of educational tool for new users?
yes, we make video for education purpose. Dont forget to claim free option. After you tried some free options, you can learn it easily
Q.When will other Warrants comes ADA ?
we want to make warrants for hot coins. As you can trade doge coin options on huobi app. We try to connecting with community and make our product as friendly as possible
Host : Its time for Wrapping Up, any last words you would like to say to the community? Mr. Paul 🙂
- Dont forget the free options😆
- As a good trader, you need to calculate the payoff. If the option is free, the payoff is huge
- Learn our product with free option!
- Thank you 😊
Here below are links for you to get the latest update about Houbi Derivatives Warrant