Do most people actually understand this about Spot Grid bots?

I have a pal using Binance Spot Grid, and this is surprisingly onerous to elucidate to him.

Think about equal grid ranges:

$100 - $95 - $90 - $85 - $80

Throughout a decline, the bot keeps shopping for and accumulates inventory. After buying at $80, its next grid sell might be at $85.

Regionally, that's right:

buy $80 - sell $85 = profitable grid cycle

But when equal amounts have been accrued at $100, $95, $90, $85 and $80, the typical worth of the entire stock is around $90.

So at $85 you'll be able to have:

Grid commerce: revenue

General collected position: still under average

The bot isn't essentially doing something incorrect — it's just managing grid pairs, which isn't the identical factor as managing the price foundation of the entire place.

I observed this virtually instantly once I first tried a grid bot, but my pal nonetheless assumes that every worthwhile grid promote should even be worthwhile for the entire amassed position.

Did you understand this before using grid bots, or only after operating one?