Stop-Loss (SL) and Take-Profit (TP) Limit Orders
Stop-Loss and Take-Profit orders are triggered by the mark/last/mid price. Once triggered, a limit order is placed to try close off your position.
If you are long and set:
When the mark price falls below $25, a limit sell order at $25 will be placed.
If the market drops quickly from $26 to $23, your order may rest at $25 without filling.
If instead you set:
The order has a higher probability of filling somewhere between $23 and $22 during a sharp move.
Lower limit prices increase fill probability but may result in worse execution.
Take-Profit (TP)
If you are long and set:
When the mark price rises above $32, a limit sell order at $31.50 will be placed.
This protects you from selling below $31.50 if the price quickly retraces after triggering.
Short Positions
If you are short and set:
When the mark price rises above $30, a limit buy order at $30 will be placed.
If the market spikes rapidly from $29 to $33, your order may not fill.
If instead you set:
The order has a higher probability of filling somewhere between $33 and $34 during fast upward moves.
Higher limit prices improve fill probability but may result in worse execution.
Take-Profit (TP)
If you are short and set:
When the mark price falls below $20, a limit buy order at $20.50 will be placed.
This ensures the order will not fill at a worse price (above $20.50) if the market rebounds after triggering.
