when will trading start?
I've put them on sale a few hours ago. Apparently GLBSE clips the ticker symbol in a strange way, until this is sorted out they can be distinguished by their description, the long says "leveraged purchase" and the short says "short selling".
I'm not that interested in the value finding for the bond itself (according to your example it should be just (1 + your cut percentage) * ( (trade price - lower limit) / (upper limit - lower limit) ) and the other way round for the other half of the deal, what I find interesting is that you decided to do this a bit assymmetrical by issuing 400 long and 200 short bonds. Does this implicate that you believe in short twice as much as long or the other way around, from a mathematical perspective?
I "believe more" in the short bond
when taken as part of my entire portfolio. I need more bitcoins than what I want my BTC position to be; so if I buy bitcoins above and beyond my desired position, I need to simultaneously short them. I used to use Bitcoinica for this, now I hope to do this with issuing excess long bonds. I've also priced them cheaper than the short bonds in relation to the respective baseline value. If there's demand for both bonds I'll issue more of both, the difference will correspond to my target position delta.
if long is correct, you'll need approx. 1 share income pf short to cover for the profit, however only ~ half of long shares have an equivalent short share, so you'd need to pay out of your own cut or pocket for the rest, correct?
Right. For me this acts as insurance against a drop in BTC exchange rate. If long is correct I'll need to pay extra, but it doesn't bother me as much since in this scenario my BTC holdings become more valuable.
