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Offline Chronos

Is "Market Rules Summary" correct?
« on: March 27, 2015, 10:17:13 PM »

Under "Exchange" in the client, I see a "Help" button in the upper right. It pops out this information:

Quote
Short orders can only get filled under these conditions:

1. There is someone willing to buy BitUSD at the price feed
2. AND Your short order is the highest interest rate order
3. AND Your price limit is lower than the feed (BTS per USD) or you didn't specify a price limit
4. AND You have enough collateral to provide 2x backing at the trade price and quantity
5. OR Your price limit is higher than the feed (BTS per USD) and someone is willing to buy at your price limit

Short orders are forced to cover after 30 days by taking the best offers at the time. No fee is charged.

Short orders are forced to cover when 75% of their collateral is required to cover, leaving the short with 25% of the collateral minus a 5% fee.

The 5% fee is assessed as a percent of the collateral left over after covering.
I can barely parse the AND and OR clauses, and I consider myself to be fairly logically-minded!  :P Anyway, is this information still correct? I was under the impression that it was not possible to short at a price below the feed, but point (3) seems to state that it is possible.

Thanks!
« Last Edit: March 27, 2015, 11:54:09 PM by Chronos »

Offline pc

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Re: Is "Market Rules Summary" correct?
« Reply #1 on: March 28, 2015, 08:46:25 AM »
This is mostly correct.

The AND and OR are to be understood like this: if the short has a limit above the feed, then point 5 applies. If it doesn't have a limit, or if the limit is below the feed, then points 1-4 must all apply.

Point three may be misleading - the short will execute at the price feed if its limit is below the feed (BTS per USD). Point 1 should be "...at the price feed or above (BTS per USD)."

Forced covers are executed at the feed price or up to 11% above. (This is going to change with the new market engine.)

About the fee I'm not sure.
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Offline Chronos

Re: Is "Market Rules Summary" correct?
« Reply #2 on: March 28, 2015, 09:39:49 PM »
the short will execute at the price feed if its limit is below the feed (BTS per USD).
At the price feed? Maybe I don't know what "limit" is supposed to mean. I would think that execution above a limit would mean that the limit didn't work as intended (?).

Offline pc

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Re: Is "Market Rules Summary" correct?
« Reply #3 on: March 29, 2015, 08:39:10 AM »
The limit of the short is the minimum price (BTS per USD) for which the owner of the short is willing to sell the USD he borrows from the market.
The rules say that he can't sell his borrowed USD below the feed, so if the limit is below the feed the USD will be sold at the feed price. If the feed is below the limit, the USD from the short will be sold at the limit, provided someone is willing to pay the price.
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Offline Chronos

Re: Is "Market Rules Summary" correct?
« Reply #4 on: March 29, 2015, 04:28:10 PM »
The limit of the short is the minimum price (BTS per USD) for which the owner of the short is willing to sell the USD he borrows from the market.
The rules say that he can't sell his borrowed USD below the feed, so if the limit is below the feed the USD will be sold at the feed price. If the feed is below the limit, the USD from the short will be sold at the limit, provided someone is willing to pay the price.
Ah, that explains point (3). It's a lower limit, so filling the short at a higher price does not violate it. Thanks for the clarification!

 

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