Q: What is Max Slippage and why is it important?
A: Max Slippage is the predefined threshold that determines the maximum allowable difference between the trigger price against the upper or lower limit executed price of a trade. It prevents excessive slippage during market volatility, ensuring orders are not executed at a significantly unfavorable price.
Q: How does Max Slippage work?
A: Max Slippage sets a predefined threshold on the acceptable difference between the trigger price and the upper or lower limit executed price of a trade. If the current trading price exceeds the threshold, the order will be canceled fully by the system, preventing users from executing trades at unfavorable prices.
An example:
BTCUSDT.PERP has a max slippage of 0.25%.
Assuming that you place a trigger order at a trigger price of 30,000. When Mid Price reaches 30,000, the system will calculate the max slippage as follows:
30,000*1.0025 = 30,075 (Long Position)
30,000*0.9975 = 29,925 (Short Position)
Therefore, if the current price at the time of trigger order execution exceeds the threshold stated above, the order will be canceled fully.
Q: Is the Max Slippage calculated differently for open and close order(s)?
A: Yes, Max Slippage is calculated differently for open and close order(s).
When placing an order to open a position, standard Max Slippage is applied.
When placing an order to close an existing position, Max Slippage applied will be doubled.
An example:
BTCUSDT.PERP has a max slippage of 0.25%.
Assuming that you place a trigger order at a trigger price of 30,000 to close an existing position. When Mid Price reaches 30,000, the system will calculate the max slippage as follows:
Max Slippage for close order = 0.25%*2 = 0.50%
30,000*1.0050 = 30,150 (Long Position)
30,000*0.9950 = 29,850 (Short Position)
If the current price at the time of trigger order execution exceeds the threshold stated above, the order will be canceled fully.
Q: What is the Time-In-Force for Market and Trigger orders in Flipster? How will it affect me?
A: The Time-In-Force (TIF) for Market and Trigger orders is Fill-Or-Kill (FOK).
FOK orders only allow it to be either executed or canceled fully, without fulfilling partially.
As an example, Trader A has an open position for 10 contracts of BTCUSDT.PERP. With the current liquidity in the platform, it only allows to fulfill 6 contracts of BTCUSDT.PERP when he chooses to close the position.
In this regard, the entire closing order will be canceled as it cannot be executed fully.
Hence, in times of market volatility, users can expect cancellation of the market or trigger orders if the entire quantity cannot be fulfilled within the max slippage threshold. However, do note that cancellation of orders is not limited to the example above.
Q: How can I check the Max Slippage for a specific symbol/contract?
A: Users can check the Max Slippage for each symbol/contract on the contracts page. It is advisable to review this information before placing orders, especially in volatile market conditions.
Q: How often does Max Slippage change for a specific symbol/contract?
A: Max Slippage values are predefined but may be subjected to periodic reviews or adjustments by the platform. Users are encouraged to stay informed by checking the contracts page regularly for changes such as (and not limited to):
- Value of max slippage for each category.
- Changes to the category for individual symbol/contract.
Q: Can I customize the Max Slippage for my orders?
A: No, Max Slippage is a non-customizable parameter set by the platform to ensure consistent risk management practices across all users.