Sunday, November 20, 2022

The MIM-proposition

Let's take a look at the shorting $MIM-proposition. If you're not familiar with this approach, @38_2_percents mentioned this thread to me.

So, I'm going to be reductionist about the thread.

"I made 7 figures" sounds like 100% gain from a 0% risk, but, following looping approach above, it's more like this:

  • if I were to invest, say, $481 in stables, using loop-approach, I'd make, at 100%-depeg GROSS $1,413.45.


But 2x net gain is the upside.

What're the downsides?

  • Liquidation, particularly if you're going to squeeze water from this rock.
  • Nothing happens, so you've set aside your money for eh-returns.
  • Nothing happens, and you're paying 14% borrow rate.

These are the risks.

So, 'make 7 figures'?

No. Unless you already have at least half 7 figures invested in this scheme.

2x return sounds good?

No. Because: I can do this elsewhere in a defined time. This timeframe is undefined.

Can you lose? Yes: possible liquidation and definite 14% borrow rate.

Now: the $481-question.

Am I doing this?

...yes?

I wish I had $1M to throw around to make $2M, but I don't, and I AM NOT RISKING my portfolio for this play.

A short should be a SMALL part of your investments, and this play, here, is a SMALL play.

I'll play it, sure, and win.

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