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Take Profit and Stop Loss Function Explanation

ASTX
Updated

In order to help users better manage position risk and lock in profits, ASTX offers Take Profit (TP) and Stop Loss (SL) functions. Below is the detailed explanation of these functions:

 

1. Basic Concepts

  • Take Profit (TP):
    The take profit function automatically closes the position at the market price when the market price moves in a favorable direction and reaches the pre-set profit target, locking in the existing profit.

  • Stop Loss (SL):
    The stop loss function automatically closes the position at the market price when the market price moves in an unfavorable direction and reaches the pre-set loss limit, preventing further losses.

 

2. Parameter Explanation

  • Trigger Price:
    The trigger price is the price level at which the system will automatically trigger the take profit or stop loss order when the market price reaches your set trigger price.

  • Order Price:
    After triggering, the system will submit the closing order according to your set order price and close the position at the market price.
    Note: During significant market fluctuations, the actual execution price may slightly differ from your set order price.

 

3. Operation Process

  1. Set Trigger Price:
    Users should set the trigger price for take profit and stop loss based on their personal risk tolerance and market conditions.

  2. Trigger Take Profit or Stop Loss:
    When the market price reaches your trigger price, the system will automatically submit the closing order.

  3. Take Profit Triggered:
    When the market price reaches the take profit target, the system will close the position at the market price to ensure you lock in the profit.

  4. Stop Loss Triggered:
    When the market price moves in an unfavorable direction, the system will automatically close the position at the market price to limit your losses.

 

4. Take Profit and Stop Loss in Position Management Mode

  • If No Take Profit or Stop Loss Set Before Adding Positions:
    If no take profit or stop loss was set for the original position before adding more positions, the take profit and stop loss set during the position addition will apply to all positions and generate new orders.

  • If Take Profit or Stop Loss Already Set Before Adding Positions:
    If the original position already had take profit or stop loss set before adding more positions, the take profit and stop loss set during the addition will not overwrite the original ones, and no new orders will be generated.

 

5. Situations Where Take Profit and Stop Loss Might Be Canceled

  • Forced Liquidation or Reduction Triggered:
    If the position is liquidated or reduced before the take profit or stop loss is triggered, the take profit or stop loss order will be automatically canceled.

  • No Remaining Position to Close:
    If there are limit close orders occupying the closable quantity in the position, the system will not be able to execute the take profit or stop loss orders.

 

6. Trading Risk Warning

  • Reasonable Take Profit and Stop Loss Settings:
    Reasonable take profit and stop loss settings help effectively manage market volatility risks. It is recommended to dynamically adjust the take profit and stop loss strategy based on market conditions.

  • Market Volatility Risks:
    Please note that market volatility may cause significant fluctuations, and the actual execution price may differ from the preset take profit or stop loss price. Always assess the potential risks.

  • Regular Checks:
    Users are advised to regularly check their take profit and stop loss orders to ensure they are correctly set and to avoid execution failures caused by duplicate settings or position occupation.

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