Grid Strategy Description
Grid Strategy Explanation
I. Contract Grid Strategy
What is a Contract Grid Strategy? A contract grid strategy is an automated trading strategy within a specific price range that involves buying low and selling high (or selling high and buying low). The user sets the highest price, the lowest price, and the number of grids. The system will automatically place orders, buying and selling as the market fluctuates to achieve arbitrage profits. Currently, contract grids support USDT contracts for all currencies, and coin-margined contracts will be supported in the future.
Applicable Scenarios for Contract Grids The core of the contract grid strategy is "oscillating arbitrage," making it suitable for prolonged oscillating markets. Additionally, contract grids can have long or short tendencies:
Long Grid: Only opens and closes long positions, suitable for oscillating upward markets.
Short Grid: Only opens and closes short positions, suitable for oscillating downward markets.
Neutral Grid: Opens short/close short above the market price and opens long/close long below, suitable for sideways markets.
Steps to Create a Contract Grid and Related Parameters
3.1 Creation Steps:
Access the BitForg APP, select “Strategy” at the top of the “Trading” page, then choose the spot grid.
Enter parameters, confirm the investment amount, and create the grid (the funds will be isolated from the trading account and used independently).
Once created, you can view and manage the grid under the “Strategy” page.
3.2 Related Terminology and Parameters for the Grid Strategy:
Manual Creation: Set parameters based on the user's assessment of the range.
Grid Order Parameters:
Minimum Price: The strategy stops placing orders when the market price falls below this price.
Maximum Price: The strategy stops placing orders when the market price exceeds this price.
Number of Grids: The number of small intervals for placing orders. For example, if the range is 100-400 and the grid count is 3, the range is divided into 100-200, 200-300, and 300-400.
Leverage: The leverage multiplier for the strategy, up to 50x.
Margin Invested: The amount of funds invested in the grid strategy, with the maximum being the transferable amount of that currency in the account.
Arithmetic Grid: The difference in price between adjacent orders is equal.
Geometric Grid: The ratio between adjacent orders is equal.
Take Profit/Stop Loss Price: The strategy automatically stops and closes positions at market price when the price reaches this level.
Base Position Selection: When starting the strategy, you can choose whether to open a base position. For example, in a long grid with the base position enabled, a long position will be opened above the current price, and profits can be taken as the price rises. The same logic applies to a short grid.
Total Amount: The total size of funds using leverage. Total amount = margin invested * leverage.
Effective Leverage: The leverage risk of the position, calculated as the position value/strategy account equity.
Important Notes:
Once the price exceeds the maximum or minimum of the range, the strategy will stop operating. If the price moves in one direction and doesn’t return to the range, this could result in floating losses, and there may even be a risk of liquidation. It is recommended to set stop-loss levels reasonably.
After the grid is created, funds are isolated from the trading account, and position risks should be monitored.
If the token is halted or delisted during the strategy operation, the grid strategy will stop automatically.
II. Spot Grid Strategy
What is a Spot Grid Strategy? A spot grid strategy is an automated strategy that executes buying low and selling high within a specific price range. Users only need to set the highest price, the lowest price, and the number of grids. The strategy will automatically calculate the buying and selling prices for each grid and place orders. With market fluctuations, the strategy captures profits by buying low and selling high.
Applicable Scenarios for Spot Grids The core of the spot grid is "oscillating arbitrage by buying low and selling high," which is particularly suitable for oscillating and oscillating upward markets. However, in a downward market, there is a risk of loss.
Steps to Create a Spot Grid and Related Parameters 3.1 Creation Steps:
Access the BitForg APP, select “Strategy” at the top of the “Trading” page, and then choose the spot grid.
Enter parameters and confirm the investment amount to create the grid (the invested funds will be isolated from the trading account).
Once created, you can view and manage the grid under the “Strategy” page. Profits can be withdrawn at any time, or the grid can be stopped during the strategy's operation.
3.2 Related Terminology and Parameters for the Grid Strategy:
Manual Creation: Set parameters based on your assessment of an oscillating market.
Specific Grid Parameters:
Minimum Price: The strategy stops executing orders if the market price falls below this price.
Maximum Price: The strategy stops executing orders if the market price exceeds this price.
Number of Grids: The number of small intervals for placing orders within the oscillation range (e.g., if the range is 100-400 and there are 3 grids, the range is divided into 100-200, 200-300, and 300-400).
Invested Currency: You can choose the trading currency, the settlement currency, or both.
Invested Amount: The amount of each currency invested, with the maximum being the transferable amount in the trading account.
Arithmetic Grid: The price difference between adjacent orders is equal.
Geometric Grid: The price ratio between adjacent orders is equal.
Take Profit Price: The strategy stops and sells the spot when the token price rises to this level.
Stop Loss Price: The strategy stops and sells the spot when the token price drops to this level.
Important Notes:
If the market price falls below the grid range’s minimum price, the strategy will stop operating. It is recommended to set stop-loss levels below the grid minimum.
After the grid is created, funds will be isolated from the trading account, and overall position risks should be monitored.
There may be failures in selling the token after take-profit or stop-loss triggers. Users may need to manually sell the token.
If the token is halted or delisted, the grid strategy will stop automatically.
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