Contents:

Introduction

The 6SR trading system allows you to trade call options on supported assets. Upon expiration, the system automatically assigns options which are in the money. The user also has ability to execute a contract at any time before the expiration.

How It Works

  • 1. Send an email davek@6thstreetradio.org for an account. The accounts are wallets on the stellar network, and new accounts require an initial deposit of 5 XLM, which is credited to your account.
  • 2. Next, purchase or deposit assets. To purchase assets with XLM, go to the wallet page and find the "Buy BTC" section. Input the amount of BTC you want to purchase, and click the " Buy BTC" button. Refresh the page to check the new BTC balance in the grid at the top of the page. Repeat the process with USD if you plan to purchase options priced in USD. Note these assets are on the public stellar network and can be purchased on the SDEX (stellar distributed exchange) using any stellar client.
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  • 3. Once you have the assets you need, select a market from the market list. All non-expired markets are available to trade in. then move on to trading...

Trading

Here you can buy and sell existing contracts, create new ones for sale, or execute existing ones you already own.
  • To buy and sell existing contracts, simply use the "buy open" or "sell close" tab buttons. These operate the same as any other asset on the stellar network. In fact, you can use any other stellar network client to buy and sell these assets.
  • To write new contracts (also known as a "covered call" in options speak), use the "sell open" tab. This is done in 3 steps:
    • 1. Use the "create account" button to create a new escrow account. This only needs to be done once per market.
    • 2. Fund the account with the amount of the asset for which you wish to write contracts. For example, in a BTC option with a multiplier of 1, depositing 1 BTC in the escrow account will result in 1 contract credited to you account. The minimum deposit is 0.01 BTC. Note: escrow deposits must be done through the trading site.
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    • 3. You now have option contracts in your wallet which can be sold on the open market.
  • To exercise an option before it expires, use the "exercise" tab button. Input the number of options you wish to exercise (minimum of 0.01), and click the exercise button. The system will find the seller of the contract, and execute a trade for that amount of bitcoin at the option's strike price. The contract is then destroyed. 6SR takes a small fee for brokering the transaction. Note: in the money contracts are automatically exercised at 4:30pm est on the expiration date, provided the account has enough funds to make the purchase in full.

Withdrawals

XLM can be transferred out of your trade wallet at no cost. The secret key (if any) can be revealed on the wallet page. BTC and USD withdrawals are processed manually and for a small fee. Contact davek@6thstreetradio.org to request direct withdrawals.

How You Can Profit

Options trading involves risk and is not for everyone. With precision and attentiveness, profit is gained. There are many ways to make money trading options on this platform. the simplest one is the same as any other asset: buy low sell high. However, since an option expires at a known date (unlike a stock, for example), extra care must be taken. Here are two other ways to make money in this system:
  • 1. Receive a type of dividend on owned BTC assets. Normally, people who are long term investors in BTC just get to watch it sit there. Now, by selling out of the money call options, they can receive payments on their balance. The risk is that their BTC is called away, in which case their profit would still exist, but be slightly limited.
  • 2. Profit from market volatility without the full cost. A user can purchase a contract for a fraction of what it takes to purchase the full asset. For example, a user can purchase 1 in the money call option for one bitcoin for 10 USD. The price of bitcoin often fluctuates 100 USD within a few days. With proper timing, the user could sell it for twice or more what they paid. This is a form of leveraged buying without the risk of loans or margin accounts. The risk is that you have to hold the contract to expiration, because you don't have enough money to purchase the asset. In this case you do lose money, but your loss is limited.
With any market, it is likely that some will profit and some will lose. But with this options market, it is at least possible for everyone to profit. We at 6th Street Radio wish you responsible trading, and high profits!
 

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