In my opinion, there are three ways to structure rewards to maximize profits:
- Power up and hold SBD
- 50/50 and sell SBD
- Power up and convert SBD
Which of these three is best has to do with the price of SBD. Theoretically, SBD should be worth $1. If it is far from $1, then one can leverage the difference for a profit. Otherwise, it is probably better to take the Steem Power (SP).
If SBD has a market value of $1, or close to it, then there isn't really profit in it. While SBD is close to $1, I think it would be best to set the reward preference to Power Up 100% and reap the benefits of extra SP. I like to hold on to any extra Steem and SBD I may have in my account for later use. However, converting it all to SP is an option, as well.
If SBD is well over $1, then it is optimal to set the reward preference to 50/50 payout. The rewards are allocated as if SBD were worth $1. If SBD sells for over a dollar on the internal market, then selling the SBD for Steem gives Steem than if choosing to Power Up 100%. Hold on to the Steem for later use.
If SBD is well under $1, then I would want to Power Up. This undervalued SBD can be acquired with any extra Steem. Then use the 'convert' blockchain function to get $1 worth of Steem for each SBD. How is this profitable? For example, if SBD is purchased at $0.85 and converted, then $1 worth of Steem is obtained for only $0.85. The Steem is essentially on sale. The conversion process takes a few days but, as long as the SBD price is low, the process can be repeated indefinitely.
Currently, the price of SBD is sticking fairly close to $1. Using the above logic, it is my opinion that it is currently best to Power Up 100%.