Pure Market Making

This strategy allows Hummingbot users to run a market making strategy on a single trading pair on IDEX.

It places limit buy (bid) and limit sell (ask) orders on the order book at prices relative to the mid-price with spreads equal to bid_spread and ask_spread. Every order_refresh_time seconds, the strategy replaces existing orders with new orders with refreshed spreads and order amounts.

Learn more here https://hummingbot.org/strategies/pure-market-making/

This guide will show how to setup a pure market making strategy on IDEX.

Start Hummingbot if you haven't already. Here's a comprenhensive guide on how to do this: https://hummingbot.org/operation/launch-exit/

Creating a new strategy

Make sure you're already connected to IDEX using your credentials. You may have done so at the end of our Hummingbot setup guide. If not, you can do so now by using the connect command.

To create a strategy on Hummingbot, we must enter the create command:

Hummingbot will ask you "What is your market making strategy?" and you'll select "pure_market_making" as shown here:

Next, you'll be ask to specify which connector to use. Here's you must choose IDEX:

Now we'll enter the market pair we'll be operating on. In this example we'll use IDEX-USDC

Enter your spread parameter for bids and asks in percentage form:

In our example, we're usnig a 1% spread (which can be considered a tight spread).

A wide spread means Hummimgbot will make less trades but make/lose more money on each trade. A tight spread means Hummingbot will make more trades but make/lose less money on each trade.

Now we'll enter our order frequency. This means how often we want to cancel and replace bids and asks in seconds (so if you want to refresh orders every 15 minutes: 15x60=900 seconds).

We'll use 5 seconds in our example

Next, we specify the amount of tokens the bot will be operating with on each trade. In our example we'll use 555 IDEX tokens.

You'll be asked if you'd like to use the ping pong feature. The ping pong strategy tries to keep buys and sells balanced by only creating orders on the opposite side of an order that is filled. It will keep on creating orders on the opposite side of the filled order as long as ping_pong is set to enabled.

You can read more about the ping pong feature here: https://hummingbot.org/strategy-configs/ping-pong/

Once these parameters have been defined, you'll be asked to save your strategy configuration. Enter a name for it and press enter.

Now you can start your strategy by running the start command, as shown here

Hummimgbot will start operating using the parameters you've provided. A more in-depth guide about how to configure the pure market making strategy can be found here:

Pure Market Making - Hummingbot Foundation

Our friends at Hummingbot have also made a comprenhensive video on how to setup a market making strategy, check it out here:

Happy trading!