This guide shows you how to setup the kelp bot using the sell_twap strategy. This strategy will sell tokens using the well-known TWAP metric. We'll configure it to sell a COUPON token; COUPON can be any token you want and is only used as a sample token for the purpose of this walkthrough guide.
The bot places a single sell order which is refreshed and randomized at every bot update as configured in trader.cfg. There is a fixed sell capacity for each bucket based on the daily sell limit configuration. Any value that is unsold in a given bucket (surplus) is distributed over the remaining buckets. The config values control the bucket size along with other factors to determine the distribution of the surplus.
First, go through the Account Setup guide to set up your Stellar accounts and the necessary configuration file, trader.cfg. In the sell_twap strategy the bot is programmed to sell ASSET_CODE_A from the trader.cfg file.
Download the pre-compiled binaries for kelp for your platform from the Github Releases Page. If you have downloaded the correct version for your platform you can run it directly.
Use the sample configuration file for the sell_twap strategy as a template. We will walkthrough the configuration parameters below.
SellTwap requires one price feed, START_ASK_FEED. This computes the price used when placing the single sell order.
To give COUPON a stable price against USD, we're going to set START_ASK_FEED_TYPE to "exchange" and START_ASK_FEED_URL to "kraken/XXLM/ZUSD". This points our bot to Kraken's price for 1 XLM, quoted in USD.
For the purposes of this walkthrough, we set the PRICE_TOLERANCE value to 0.001 which means that a 0.1% change in price will trigger the bot to refresh its orders. Similarly, we set the AMOUNT_TOLERANCE value to 0.001 which means that we need at least a 0.1% change in amount for the bot to refresh its orders. If either one of these conditions is met then the bot will refresh its orders. In practice, you should set any value you're comfortable with.
Note that this strategy randomizes the order size at every update, so that should be taken into consideration when setting these tolerance values.
The PARENT_BUCKET_SIZE_SECONDS configuration defines the size in seconds of each bucket. There are 86,400 seconds in each day. The number of buckets is determined by dividing 86,400 by PARENT_BUCKET_SIZE_SECONDS, so PARENT_BUCKET_SIZE_SECONDS needs to perfectly divide 86,400.
In our sample configuration we have set this to 600 seconds, which is equal to 10 minutes. This will give us 144 buckets every day.
There are two config params that control how the surplus is distributed, DISTRIBUTE_SURPLUS_OVER_REMAINING_INTERVALS_PERCENT_CEILING and EXPONENTIAL_SMOOTHING_FACTOR.
DISTRIBUTE_SURPLUS_OVER_REMAINING_INTERVALS_PERCENT_CEILING is a decimal value between 0.0 and 1.0, both inclusive. Setting this to 0.0 will discard any surplus and setting it to 1.0 will distribute the surplus over all the remaining buckets. Setting it to 0.50 will distribute it over 50% of the remaining buckets.
EXPONENTIAL_SMOOTHING_FACTOR determines how smoothly we should distribute any surplus. This is a decimal value between 0.0 and 1.0, both inclusive. Setting this to 0.0 will sell the entire surplus in the next bucket interval (least smooth). Setting this to 1.0 will distribute the surplus evenly (linearly) over the chosen bucket intervals (most smooth).
The DAY_OF_WEEK_DAILY_CAP determines the daily limit of how many tokens of the base asset to sell. This has to be of the form "volume/daily/sell/base/X/exact" where X is the daily limit in base units to be sold. This configuration is a map of volume filters for each day of the week, which gives you flexibility to have a per-day configuration. A filter for each day must be specified.
The capacity of each bucket is the daily sale amount divided by the number of buckets + the surplus allocated to that bucket.
As mentioned above, the order is randomized and refreshed at each bot update at the interval described in the trader.cfg file. The minimum order size for this randomization is controlled by MIN_CHILD_ORDER_SIZE_PERCENT_OF_PARENT which is a decimal from 0.0 to 1.0, both inclusive. A value of 0.0 means that there is no minimum order size, whereas a value of 1.0 indicates that the order size should be the capacity of the bucket (i.e. no ramdomization). If the capacity for the bucket is less than the computed minimum amount then the remaining capacity is used as the order size.
Assuming your botConfig is called trader.cfg and your strategy config is called selltwap.cfg, you can run kelp with the following command:
kelp trade --botConf ./path/trader.cfg --strategy sell_twap --stratConf ./path/selltwap.cfg
You can also play around with the configuration parameters of the sample configuration file for the sell_twap strategy, look at some of the other strategies that are available out-of-the-box or dig into the code and create your own strategy.