I have been quite busy in the past week, and I haven't gotten around to posting the results of my second week of converting SBD.
If you haven't read them, you might want to check out my previous posts for some context:
Testing The Steem Dollar Peg
Sampling SBD Conversion Returns
My Week 1 SBD Conversion Results: 18.615 SBD | 7.446% ROI
The first week went very well. I made $18 SBD off of a modest investment of $250 SBD. A return of 7.446% in a single week is fantastic. My second week results were less impressive.
Despite nearly doubling my stake to $518.615 SBD, I made a bit less than half the return that I saw from my first conversion of $250 SBD. In week two, I only made $14.603, or about 2.81% return on my investment. That's actually a pretty good return for a week, even if a bit of a let down after my first week. If I had the chance to make a certain 2.8% a week, I'd be foolish not to take it every week for as much money as I could spare.
But for now I've stopped converting my SBD. The reason for that is pretty simple:
The market is pricing SBD at close to 95 cents. I even saw it priced at a dollar at one point a couple days ago. While I'm glad to see it, the closer to parity that SBD becomes the less attractive the conversion option becomes. Conversion becomes a viable option when market participants make themselves vulnerable to exploitation by undervaluing SBD.
I knew right away that my second week wasn't going to be as profitable, because I noticed that the next day the market had SBD at about $0.90 USD. The fact that STEEM was trending downward during the week had something to do with it, but the most important factor will always be the market price of SBD.
As long as the market is pricing SBD reasonably, I will not continue converting. But as soon as the market changes significantly, I will start converting again and I'll continue posting the results.
