The NFT Trading Guide - Advanced

Probabilities

• NFT trading is like poker. The goal is to not look for winning every time but to make moves that are more likely to win. You must win more than 50% of the time. That's enough to gain the pot.
• If you make x10 on a degen mint, you shouldn’t be proud of your move, because the odds were against you, only luck saved you.
• Most investments will fail. But a few good investments will be big wins, compensate all the others, and make you profitable.
• Mints are gambling, and the probabilities are not in your favor.
• Degen mints are pure gambling, and the probabilities are not in your favor.
• Hyped mints are gambling, and the probabilities are in your favor.
  NB: Some collection DAOs get their value from getting you whitelist spots for the hyped mints.
• Like in any investment, diversify.
• Mints are like seed investment, you invest before having seen anything. So, it's better to get in after observing the team for a few months and buy on secondary.
• It's a good time to buy when you are confident about a team and see the price dumps for a non-valid reason. The chances of a floor price increasing are higher.
• You can do everything right and still have bad luck. Don’t forget that your NFTs are money too, so don’t put you at risk financially when investing in NFTs.

Web2 VC inspiration

• VCs start by investing the same amount of money in every project they get into.
• They bet a lot on teams.
• They observe the projects for months or years before getting in.
• They invest in sectors (games, B2B, B2C, social networks, etc.).
• They invest in specific growth stages (seed, series, etc.).
• They look for a x10, some x2, and know they will lose everything with the rest.

Small collections

• Small collections are harder to trade but lead to more direct trading between collectors.
• It’s easier to network within small collections. All members are accessible.
• Because there are fewer people, everyone is more visible. To make sure your NFTs keep their price, be active, and try to bring value with hindsight, good vibes, advice, introductions, whitelists, etc.

Bidding

• Look for rare pieces where the owner frequently decreases the price. Bid with a 10-20% discount or slightly above the floor price. They will probably accept.
• Place a reasonable collection bid on projects you like. Many people need liquidity fast, and they will enjoy accepting your bid
• Be aware that your liquidity is available slowly when you bid (you must remove it from the bid to reaccess it).
On some marketplaces, bidding prevents you from royalties.

1/1s

• 1/1 prices can be a lot more above a collection floor.
• 1/1, tied to a collection or not, are mainly traded inside communities through direct discussions. Only strong believers are ready to put a big amount of money on the table.
• These discussions can be stressful, and there is no right price. It’s just a discussion between two passionate people. If you want to be sure of what you are doing, check recent similar trades on ME or ask about the related Discord. It might help.
• During a bearish time for a collection, the 1/1 price drops significantly.
• If you sell with profit, you are never wrong.
• For collection 1/1s, make sure you sell them at a multiple of the floor price.
• Always use trusted tools like Foxyswap to secure these deals.

Reveal

• The collection price dumps shortly after a reveal. It’s because people expect to have a rare. Holding before revealing is a bit of gambling. Because all the people are unsatisfied with their reveal, dump it as fast as possible. Even when they like the collection. Because they will be able to buy something they prefer right after.
• The safest option is to sell when the collection is trendy before the reveal. It’s probable that you will be able to get in right after.