How to calculate profit on a trailing down bot?

July 22, 2022

411

Calculating the profit on the trailing down is difficult for beginners. Here is the easy formula to calculate the profit and loss on the trailing profit. You can use this just by having the right numbers. Read to know more.

Table of Contents

Trailing down bot profit calculator explained

If you are into buying and selling of the trades then you have heard about the trailing take profit. It is used to increase the price rises. Hence it helps in generating more profit. Since it works in only one direction so it limits trailing stop loss and triggers price in the positive direction. It is commonly used by beginners. Many beginners do not know how to calculate profit on a trailing down the bot. You are at the right place. We will discuss how you can calculate your profit on the trading bot.

What is trailing take profit?

Trailing take profit is different from the trailing stop order. However, both of these are used in crypto. Trailing profit gives more benefits as it locks in profit and does not let the graph go down. When the price rises, trailing profit sets a new high record. If in any case, the price moves downward then it automatically closes the deal by cancelling the order type or by selling the order. This is why beginners use this because the risk of losing money here is very low.

Disadvantages of trailing profit

If you will not use the trailing profit wisely then there are chances that you might face a loss. Here are some disadvantages that you might face if you will not use this properly.

1) Do not use this when there is a wide number of buy and sell-off coins. Because in that case the profit goes up and down a lot and in case of any slit loss the trailing profit will end the deal soon. Which eventually turns into a loss for you.

2) Coins that have low liquidity change their prices very frequently. Here the trailing seller sells the order very early and you lose some amount.

3) In case you are sure that the profit percentage will come on the previous level then immediately sell the order. Because if trailing profit will sell on behalf of you then it will take some commission. So basically you do not receive the full amount of the profit.

To learn how to calculate profit on a trailing bot?

The price is calculated in two forms: first how you sell orders and second how you buy orders. Kets see both.

Sell order

Profit = opening price – price change

Loss= opening price + price change

Buy order

Profit = opening price + price change in point

Loss= opening price – price change in point

These are the only methods to calculate your profit and loss on trailing down the bot. It is very simple yet the beginner remains unaware of this. Hence sometimes they miscalculate the profits. Use this method next time to calculate your sell prices profit and loss.

Working on the trailing profit

The working of a trailing bot is very easy. If you have bought an order for $200 and you set the profit, imitate $250 then trailing profit will not do anything until it will reach the selected goal. Once it crosses the goal, the day of the order reaches $280 then it will set the new lower price at $250, and when the order comes down to $250 it will automatically sell the order to avoid any loss. Trailing profit works best with a huge market order and it helps the person to lower the risk of loss. Hence it is always the forest choice for beginners.

Why do beginners face losses in trading?

Since the beginners do not have knowledge about how to use the stop loss they tend to lose more money than the advance and medium-level traders. The first few trades are always in loss sometimes this discourages the young traders and they give up on the trading. But if you practice and try to learn a little daily about the stop then you can reduce the risk of losing. A small amount of profit gives very big hope. So do not stop practising and learning.

Conclusion

In conclusion, beginners do not know how to calculate the profit on a trailing down bot. Here is the ultimate guide for this. It is very easy to calculate the profit if you have the right numbers. As beginners, it might seem tough but trust me it will get better with time.

This is how you can use the trailing profit effectively to reduce the risk of loss. Trailing profit is made for the beginners hence it makes the crypt and trading more fun for them. This way beginners do not lose interest in trading and save some money as well.

How To Increase Engagement Rates On Instagram(Opens in a new browser tab)