Understanding Thresholds:
The threshold represents the maximum deviation allowed for the asset portfolio balance ratio.
Example Scenario:
Suppose the initial balance ratio of ETH/USDT is 50%:50%, with a threshold of 0.1%.
If the price of ETH fluctuates, resulting in the current asset balance ratio shifting to 50.1%:49.9% or 49.9%:50.1%, the system will execute an open order to restore the balance ratio to 50%:50%.
Effect of Thresholds:
Lower thresholds lead to narrower spreads of orders and increased frequency of trades.
In volatile markets, a lower threshold allows for more frequent trades, potentially earning higher rebalancing premiums.
Determining Minimum Threshold:
The minimum threshold allowed is determined by the total investment amount and virtual funds.
In the RMM AI version, users are relieved from setting thresholds as the system automatically adopts the minimum threshold permitted