What is the take-profit function in Spot Bot crypto trading bot

What is the take-profit function in Spot Bot crypto trading bot

In order for your spotbot to bring you profit, take care of the correct setting of the take-profit function. This will help set up automated trading in such a way that the bot sells and buys assets only when it is beneficial for you. 

What is take-profit

Take-profit is an order that is used to manage risk. In a certain market situation, the target spotbot system is turned off, and the bot, in turn, sells all assets that are used in open orders where the take-profit function is enabled. 

Take-profit is used quite simply. In the bot settings, the user specifies the percentage of profit that he wants to receive from the sale of a certain asset. When cryptocurrency quotes reach a certain value, spotbot target quickly sells it. It is clear that such a situation on the market may not happen, so the settings of the trading bot should be regularly adjusted depending on the situation.

Consider an example to better understand how take profit works in spot bot pro

You have set up automatic trading in the ETH/USDT pair. The take profit indicator is set at 15%. As soon as USDT streaming assets increase in price by 15%, the bot will close the orders and sell the remaining ETH.

How to activate the take profit function in Spot Bot

If you are using The Spot Bot for automated trading, it is important to know how to enable a take profit order. To begin with, it should be noted that the feature is only available to those users who subscribe to the Pro package. 

Take profit for a new bot is connected in the following way:

  • Click on the “Start new bot” button.
  • Find and activate the take profit button.
  • Specify what percentage of profit you want to receive.

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.
  • View current settings. If you agree with them, press the “Confirm” button.

Remember that the bot sells (Spotbot sale) when the currency quote reaches a certain percentage. If the cost does not meet the take profit conditions, the bot will ignore the function and continue to actively conduct transactions relative to the entered settings. 

How to set up take profit correctly

The situation on the market does not always meet our expectations. When the value of an asset falls, professional traders use another order to reduce the possible profit – stop loss. 

If you are looking for the right spot bot solution in terms of take profit/stop loss ratio, take a notice at the actions of experienced traders. More often they use such ratios between these two orders 1:3, 1:2, 1:1, 2:1. The option is independently selected by the trader based on the strategy that he has compiled. 

Remember that in trading it is important to strictly follow to the chosen strategy. If you make emotional decisions, then even with automatic trading you will incur losses. Basically, the optimal ratio between take profit and stop loss is 1 to 3. This means that one take profit can cover losses from 3 stop losses.