What is the take-profit function in a cryptotrader’s Spot Bot
In order for your spotbot to bring you profits, take care to set up the take-profit function properly. This will help set up automatic trading so that the bot will sell and buy assets only when it will be profitable for you.
What is take-profit
A take-profit is an order used for risk management. In certain market situations the target spotbot system switches off and the bot in turn sells all the assets which are used in open orders with the take-profit function enabled.
Take-profit is used quite simply. In the settings of the bot, the user specifies the percentage of profit he wants to get from the sale of a particular asset. When the cryptocurrency quotes reach a certain value, spotbot target quickly sells it. It is clear that such a situation may not happen in the market, so the settings of the trading bot should be adjusted regularly depending on the situation.
Let’s consider an example to better understand how the take profit in the spot bot pro works.
You set up automatic trading in the pair ETH/USDT. The take profit indicator is set at 15%. As soon as the flow assets in USDT will increase in price by 15%, the bot will close orders and sell the rest of ETH.
How to activate the take profit in Spot Bot
If you are using The Spot Bot for automated trading, it is important to know how to enable the take profit order. To begin with, it should be noted that the function is available only for those users who have subscribed to the Pro package.
The take profit for the new bot is activated as follows:
- Click on the “Start new bot” button.
- Find and activate the take profit button.
- Specify what percentage of profit you want to get.
To activate the take profit function for the old bot, follow these steps:
- Click on the “Modify” button.
- Enable the take profit function and specify the profit percentage.
- Check the current settings. If you agree with them, click “Confirm”.
Remember that the bot sells (Spotbot sale), when the currency quote reaches a certain percentage. If the value will not meet the conditions of take profit, the bot will ignore the function and continue to actively carry out transactions with respect to the settings entered.
How to properly configure take profit
The market situation does not always meet our expectations. When the price of an asset falls, experienced traders use another order to reduce possible profit – the stop loss.
If you are looking for a suitable solution for your trading bot (spot bot solution) regarding the ratio of take profit and stop loss, take note of the actions of experienced traders. The most frequently used ratios between these two orders are 1:3, 1:2, 1:1, 2:1. The variant is chosen by the trader himself based on the strategy he has compiled.
Remember, it is important to stick to the chosen strategy when trading. If you make emotional decisions, you will incur losses even in case of automated trading. Basically, the optimum ratio between take profit and stop loss is 1 to 3. This means that one Take Profit can outbid losses from 3 Stop Losses.