How to Run a Delta Hedger Bot

A Delta Hedger Bot automates directional risk management for options books or market-making strategies. It continuously tracks your net delta across an underlying asset (or scoped to a specific position) and automatically trades a linear instrument—such as a perpetual or dated future—to keep your portfolio at your target delta.

Step 1: Open the Delta Hedger Setup

  1. Log in to your Thalex account.
  2. Select Bots from the top header navigation.
  3. Under "Create Bot", click "Delta Hedger".
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Step 2: Select Underlying & Scope

Specify which positions the bot should track:

  • Select Underlying / Position: Choose the asset (BTC or ETH). You can monitor your net delta across the full underlying or scope the bot to a single instrument position.
  • The interface table displays each instrument, your current position, and its corresponding cash delta.
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Step 3: Configure Core Strategy Parameters

Set your targeted delta exposure and execution parameters:

  • Target Delta: The net delta the bot maintains (e.g., 0 for delta-neutral). Acceptable range: -10 to 10.
  • Hedging Instrument: Select the contract used to execute hedges (typically the perpetual contract on the same underlying).
  • Max Slippage: The maximum allowed price slippage on hedge trades (as a percentage of mark price). If the market moves beyond this threshold, the bot pauses execution.
  • End Time: The timestamp at which the bot stops. Any remaining positions are left intact.
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Step 4: Fine-Tune Hedging Levers (Schedule & Safeguards)

The bot uses three complementary controls to optimize hedge execution and minimize fee churn:

  • Period: Sets how frequently the scheduled check runs (from 5 minutes to 24 hours). At each interval, the bot checks if your delta is outside your threshold band and hedges if necessary.
  • Threshold: A band around your Target Delta used during the Period check. Small fluctuations within this band are ignored. If delta returns inside the band before the period timer expires, the timer resets without firing a hedge.
  • Tolerance: A hard limit independent of the timer. If market moves push your delta past the tolerance limit at any moment, the bot executes an immediate hedge without waiting for the scheduled check.
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Step 5: Launch & Monitor

  1. Review your configured settings and active bounds.
  2. Click "Start Bot".
  3. Track active status, live net delta, executed hedges, and PnL under Bot Activity on the Bots page. To stop hedging at any time, click "Stop".
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