How Do Trading Systems Work?

It is normal to have a feeling of anxiety when considering “how am I going to make money trading?”

The market is constantly changing around us and there are many others in the order book who are smarter and better capitalized than us.

So we start off by asking “what are the easiest, highest-probability ways we can make money at scale?”

The best starting point is generally simple systematic trading strategies that have made money in nearly every financial market that exists. Strategies like trend and momentum trading (buying the assets that have been going up and selling the assets that have been going down), carry trades (holding assets that pay you to hold them) and mean reversion effects (assets which have gone up too fast tend to pullback).

We also invest our spare capital in liquidity provision across the HyperEVM space. This is both highly profitable and aligned with our community goal of supporting the Hyperliquid ecosystem. Our strategies are more effective in crypto markets because crypto is still relatively young and inefficient.

Ultimately, if we are going to make a lot of money for our users, we are also going to have to be comfortable taking on risk.

I know that sounds scary, but bear with me. Risk isn’t a dirty word, and if someone suggests you are getting return without taking risk you should be very suspicious.

Fortunately, we come to battle with a few advantages over the nerds.

Nerds hate being uncomfortable, they hate going outside of their comfort zone. Even the smartest maths geniuses at Jane Street have to be gently coaxed into taking risks and getting uncomfortable.

A vanishingly small subset can do the math and at the same time have the stones to take the risk. This is our edge.