Take Profit & Stop Loss

Take profit and stop loss orders trigger based on the quoted price, not the mark price.

When opening a new market or limit order on Omni, you are presented with the option to set take profit and stop loss parameters.

Adding a take profit parameter to an order defines the price at which a position will automatically close to realize profit. If you open a $100 long on BTC-PERP at $60,000 and set a take profit for $65,000, you are instructing the platform to automatically close your position if/when Bitcoin hits $65,000 and your position has made 8.33% profit. Take profit is an incredibly useful tool that allows traders to spend less time watching and manually closing positions.

Stop loss, in a similar vein, is a parameter added to an order that defines the price at which a position will automatically be closed to realize (and limit) losses. If you open a $100 long on BTC-PERP at $60,000 and set a stop loss for $55,000, you are instructing the platform to automatically close your position if/when Bitcoin hits $55,000 and your position has lost 8.33% of its value.

Always remember that leverage multiplies both your profits and losses. If you opened the same position as described above at 5x leverage, you are still closing your positions upon an 8.33% movement in Bitcoin’s price; however, your position value would increase ~41.65% if your take profit was triggered, and decrease ~41.65% if your stop loss was triggered. Keep an eye on your leverage, and always understand how your position value will be impacted if your take profits or stop losses are triggered.

Market take profit and stop loss orders may face slippage during periods of high volatility, as they execute as rapidly as possible once the quoted price crosses the set trigger price. To avoid slippage traders can use limit take profit or stop loss orders, which only execute when the quoted price is within a defined range. Limit take profit and stop loss orders are currently in development, and are not live on testnet.

For more advanced users, multiple take profits and stop losses can be opened by opening multiple orders on the same underlying asset. For example, if you wanted to execute the same $100 long on Bitcoin at $60,000 but wanted to take half of your position out at $65,000 (8.33% gain) and the other half out at $70,000 (16.67% gain), you could open two $50 longs: one with a take profit at $65,000, and the other with a take profit at $70,000.