1.What is XT.COM Futures Grid trading?
Futures grid trading is an automated strategy that uses market fluctuations to trade futures contracts with preset intervals within a specific price range to make a profit. The strategy will continuously buy low and sell high for each grid defined, and profit from the volatile market.
The futures grid currently supports all USDT-margined futures and will support crypto-margined futures in the future.
2.Futures Grid Bot offers three (3) ways
2.1 Long mode is suitable for volatile market conditions where prices are rising. Long grids will enter long positions upon creation at market price, and take profits by closing long positions when the price rises.
Example:
Suppose Trader creates a Futures Grid Bot strategy on XT.COM based on the following parameters:
Futures trading pair：BTCUSDT
Market price：35,000 USDT
Upper price：45,000 USDT
Lower price：20,000 USDT
Number of grids: 5
Grid mode：Geometric
Leverage：5x
Intervals：17.61% ≈( (45,000/20,000)(1/5) – 1)*100%
Note:
Geometric: Each grid has an equal price difference ratio. For example, if the interval is 17.61%. The price of the next order will be 17.61% higher than the previous price.
The system will calculate the price of each grid and place your orders with 2x leverage. When the Future Grid Bot strategy is successfully activated, the positions will be placed as follows.
20,000 Buy Limit (Open Long)
23522 Buy Limit (Open Long)
27664 Buy Limit (Open Long)
Market price: 35000（No order will be placed）
37075 Sell Limit (Close Long)
45000 Sell Limit (Close Long)
Your Grid Bot will only operate within the upper and lower price bounds that have been configured. When the BTC price rises above 45,000 USDT or falls below 20,000 USDT, no new order will be placed by the Grid Bot until the BTC price returns to the price range.
2.2 Short mode is suitable for volatile market conditions where prices are falling. Short grids will enter short positions upon creation at market price and take profits by closing short positions when the price falls.
Example:
Suppose Trader creates a Futures Grid Bot strategy on XT.COM based on the following parameters:
Derivatives trading pair：BTCUSDT
Market price：30,000 USDT
Upper price：45,000 USDT
Lower price：20,000 USDT
Number of grids：5
Grid mode：Arithmetic
Leverage：5x
Intervals：5,000 = (45,000 − 20,000)/5
Note:
Arithmetic: Each grid has the same price difference. For example, if the interval is 5,000 USDT. The price of the next order will be 5,000 USDT higher than the previous price.
The system will calculate the price of each grid and place your orders with 5x leverage. When the Future Grid Bot strategy is successfully activated, the positions will be placed as follows:
45000 Sell Limit (Open Short)
40000 Sell Limit (Open Short)
35000 Sell Limit (Open Short)
Market price: 30,000（No order will be placed）
25000 Buy Limit (Close Short)
20000 Buy Limit (Close Short)
Your Grid Bot will only operate within the upper and lower price bounds that have been configured. When the BTC price rises above 45,000 USDT or falls below 20,000 USDT, no new order will be placed by the Grid Bot until the BTC price returns to the price range.
2.3 For neutral mode, the bot will short the futures contracts when price is above the base price and long the futures contracts when the price is below the base price. The bot will place long orders below the base price and short orders above the base price. When the market price hits the preset price, the long/short position will be opened, depending on which order direction is filled.
Example:
Futures：BTC USDT perpetual
Price：20000-45000
Number of grids：5
Grid mode: Arithmetic
Leverage：5
Intervals：5000 = (45000 − 20000)/5
Note:
For Arithmetic, each grid has the same price difference. For example, if the interval is 5000
USDT, then the grids are: 20000, 25000, 30000, 35000, 40000, 45000。Market price: 35000.
45000 Open Short
40000 Open Short
35000 No order will be placed
30000 Open Long
25000 Open Long
20000 Open Long
Your Grid bot will only operate within the upper and lower price bounds that have been configured. When the BTC price rises above 45,000 USDT or falls below 20,000 USDT, no new order will be placed by the Grid Bot until the BTC price returns to the price range.
Users can select the corresponding futures grid strategy based on its insight on the market outlook.
3.Options and parameters
3.1 Setup Options
AI strategy: Use the parameters recommended by backtested strategy (These parameters are based on a 7 days’, 30 days’, and 180 days’ backtest of this pair).
Set myself: Set parameters based on your own analysis of the market.
3.2 Grid Trading Parameters
Grid - Arithmetic grid: It keeps the same common difference between each grid. (For example: 1, 2, 3, 4.)
Grid - Geometric grid: It keeps the same common ratio between each grid. (For example: 1, 2, 4, 8.)
Lower price: The bot will stop placing orders when the market price is lower than the lowest price.
Upper price: The bot will stop placing orders when the market price is higher than the highest price.
Grid quantity: The number of grids represents the number of pending orders divided in the price range. For example, if the price range is 10000-40000, the mode is arithmetic, and the number of grids is 3, it is divided into three grids: 10000-20000, 20000-30000, and 30000-40000.
Initial Margin: After entering the lower price or upper price, calculate the minimum initial margin according to the formula. The minimum initial margin ≤ filled initial margin ≤ futures account balance.
Grid trigger: The grid orders will be triggered when the last price or mark price rises above or falls below the trigger price you enter.
Stop trigger: The Stop_upper_limit needs to be higher than the upper price limit, latest price, and trigger price. When the market price reaches the Stop_upper_limit, the grid will stop its operation.
The Stop_lower_limit should be lower than the lower price limit, latest price, and trigger price. When the latest market price reaches the Stop_lower_limit, the grid will stop its operation.
4.XT.COM futures grid profit and loss calculation
Grid profit
Grid profit refers to the total income generated by the automatic trading of the current futures grid strategy.
Grid profit = Price Interval × Trading Volume Per Grid (Long) × Grid Transaction Times − Service Fee
Grid annualized rate of return
Annualized Rate of Return = Total Profit/Initial Margin/Days of Operation*365*100%
Assuming Trader’s grid strategy runs for 24 hours:
Annualized Rate of Return = 500/10,000/1 × 365 × 100%= 18.25%
Note:
If the operation time of the futures grid bot is less than one day, it is counted as one day.
If the user manually closes the position or cancels the order, the grid strategy will be terminated.