Introduction to Different Take Profit/Stop Loss (TP/SL) Types

Toobit's Take Profit/Stop Loss (TP/SL) function offers the ability to manage risks better by enabling TP/SL orders simultaneously. With that, you can pre-set your TP/SL orders while placing an order. This includes Limit orders, Market orders and even Conditional orders, all directly from the trading page.

What Does Take Profit/Stop Loss (TP/SL) Mean?

• Take Profit orders are filled when prices reach a predetermined level. This feature enables traders to lock in profits and exit trade.
• Stop Loss orders, on the other hand, are filled when prices reach a predetermined level, protecting traders from excessive losses by automatically exiting the trade.

There are different types of TP/SL that can be applied in a number of situations, such as for positions, batches, and even trailing features.

TP/SL for Positions

This is when TP/SL orders apply to the entire position (existing position and subsequent position increments or decrements). When the current trading price or fair mark price of the market reaches the trigger price, an order will be placed for the entire position using either the set order price or the best execution price available. If the TP/SL order is triggered before any other orders, all remaining open orders will be automatically canceled and the TP/SL order will be executed to fully close the position. If the entire position has already been closed, then the TP/SL order will be automatically canceled.

Example:

The current number of positions is 1 BTC. After the position has been set to stop the loss of profits, a limit of 0.2 BTC is set at 0.2 BTC when the position stops loss triggers, after the 0.2 BTC limit fee is automatically revoked; if the position has been fully unlocated, the loss of earnings will be cancelled automatically.

TP/SL for Batches

This is when the current trading price or mark price reaches your set TP/SL price, an order will be placed using the specified order price or the best execution price available for the quantity you have set. If the TP/SL is triggered and the remaining position is less than the set quantity, then only the remaining position will be closed. The other open orders for the position , however, will be retained.

Example:

If the current position quantity is 1 BTC and you have set a TP/SL in batches for 1 BTC, along with an unfilled limit order of 0.2 BTC, when the TP/SL in batches is triggered, only 0.8 BTC will be closed, and the limit order of 0.2 BTC will be retained.

Trailing TP/SL

This is a specific strategy where the trader sets an order to be submitted to the market during a market pullback, otherwise known as trailing TP/SL. When the market price/mark price reaches the highest/lowest price set by the trader for this strategy with a 1 ± callback percentage, an order will be placed at the best available market price. However, if the TP/SL is triggered and the remaining position is less than the set quantity, only the remaining position will be closed. The other open orders for the position, however, will be retained.

Example:

If the current position quantity is 1 BTC and you have set a TP/SL in batches for 1 BTC, along with an unfilled limit order of 0.2 BTC, when the TP/SL in batches is triggered, only 0.8 BTC will be closed, and the limit order of 0.2 BTC will be retained.

You can also view our FAQ on Trailing TP/SL to learn more.

Do note that in the event of significant market fluctuations, the actual execution price of the TP/SL order may differ from the price at the moment of the trigger. It is also possible that the TP/SL orders may not be executed or fully executed.

Learning the different types of TP/SL will equip our users to make more informed trading decisions and enhance your overall trading performance here on Toobit. We at Toobit believe in empowering our users' choice to select the most suitable strategy for themselves according to their personal risk and trading needs.