How to set up stop-profit and stop-loss for perpetual contracts

Example Sentence:Setting stop-profit and stop-loss orders for perpetual contracts helps automate risk management and secure profits, but the execution price may vary slightly due to market fluctuations.

Oct 24, 2024 at 07:46 am

How to Set Up Stop-Profit and Stop-Loss for Perpetual Contracts

Step 1: Understand Stop-Profit and Stop-Loss Orders

• Stop-profit order: Instructs the exchange to automatically sell an asset once it reaches a predetermined price (profit target).
• Stop-loss order: Instructs the exchange to automatically sell an asset once it falls to a predetermined price (loss limit).

Step 2: Choose a Trading Platform

• OKX: A leading crypto exchange offering perpetual contracts.
• Binance
• ByBit
• Huobi
• KuCoin

Step 3: Fund Your Account

• Deposit funds into your trading account using supported methods (e.g., crypto, wire transfer).

Step 4: Place a Perpetual Contract Order

• Navigate to the perpetual contracts section of your chosen platform.
• Select the trading pair you wish to trade (e.g., BTC/USDT).
• Enter your desired order parameters (e.g., order size, leverage).

Step 5: Set Stop-Profit and Stop-Loss Levels

• Once your order is placed, click on the "Stop" tab.
• Enter the desired price level for your stop-profit and stop-loss orders.
• Adjust the "Trigger Type" if necessary (e.g., mark price, index price).

Step 6: Activate the Orders

• Once satisfied with your settings, click on "Save" or "Confirm" to activate the stop-profit and stop-loss orders.

Example:

You buy 1 BTC (at $19,000) with 5x leverage, aspiring for a profit of 5%.

• Stop-profit: $19,950 (5% above entry price)
• Stop-loss: $18,050 (5% below entry price)

Note:

• Stop-profit and stop-loss orders are effective risk management tools to limit potential losses and secure profits.
• Set realistic target and buffer prices to avoid unnecessary triggers.
• Monitor your positions regularly to adjust orders if market conditions change.
• Remember that stop-loss orders do not always execute at the exact specified price due to market volatility.