Question of the Week: How risky is using the BOTS platform?
We scale the risk level of bots from 1 to 12, where 1 means that the bot is completely risk-free, and 12 is used to show the highest risk of investments. We scale the bots based on the annual volatility of returns on the level of bots. Our team calculates the scale by looking at the trading behavior of the bot. In addition, we analyze the assets in which it is invested and investigate how diversified this wallet is.
However, the risk level appointed by BOTS is based on past performance and can’t predict the future.
- We use 1-3 to mark a stable investment in which you can expect low volatility. However, these types of bots have low potential returns.
- From 3 to 6 is still somewhat stable. This scale is applied, for example, in a well-certified supervised wallet with multiple stable assets that are not correlated to each other. As we go higher, we get close to cryptos.
- 7-9 risk levels are relatively stable for cryptos. You only get this risk level when the base asset contains a coin in which you can expect relatively low movement. The scale depends on how many times and how much you trade in the volatile coins.
- If the base asset is volatile, chances are relatively high that the wallet is categorized as having 10-12 risk levels.
Do you still have questions? Let’s talk it over in our Discord community!
Don't let anyone tell you that there is such a thing as risk-free investing. No one has control over all economic influences. You can, of course, lose (part of) your investment. But always remember: Profit is the reward for risks taken.