What is Grid Trading?
What is Grid Trading？
Grid trading is a trading strategy based on the fluctuation of stock price, which sets the strategic parameters and the system executes buy low and sell high according to the parameters to earn the band difference.
In advance, investors allocate their assets into distinct portions and establish a reference price. They then create a corresponding grid that takes into account the price variations above and below this benchmark. Should the stock price decline, activating the grid, they purchase a portion at the predetermined price and quantity. Conversely, if the stock price rises and triggers the grid, they sell a portion, capitalizing on the price differential through a cycle of buying and selling.
How do I submit a grid trading order?
Select "Grid trade" as the order type within the transaction window.
Input the price and quantity parameters as per the interface instructions, then proceed to submit the strategy.
Once the submission is done, you will find the respective grid strategy record on the individual stock details page, allowing you to click and access the strategy order details directly.
Additionally, you can view strategy order records, along with related transactions and the profit and loss status, on the asset homepage or the order record page.
In cases where the strategy is not aligned with the prevailing market trend or when monitoring needs to be temporarily halted for any other reasons, you can click on the strategy sheet and opt to either pause the operation or cancel it directly. If you require adjustments to the strategy parameters, you can click 'Modify' to make the necessary changes.
How to set grid trading parameters?
| Base price | The initial calculated price of the grid strategy. The system will calculate the grid above and below the base price based on the base price and the trigger conditions set by the user, and monitor whether the stock market price has touched the grid. |
| Maximum price and minimum price | The effective price range of the whole grid strategy operation, which is used as risk control. If the last done price is higher than the maximum price or lower than the minimum price, it is considered to exceed the effective price range expected by the grid strategy. |
| Exceeds price scale | You have the option to abstain from placing any orders or liquidate all stock positions at the current market price. |
| Trigger condition | This parameter defines the grid size, allowing you to set upper and lower grid ranges based on either price differentials or percentages. Additionally, you can configure separate order prices for when the grid is triggered by price increases or decreases. For instance, if the benchmark price is 100, you can set an order to sell at "bid 1" when the price rises by 1.00, and to buy at "ask 1" when the price drops by 1.5. If the stock price climbs to 101, the upper grid will activate, selling an order at "bid 1" for 1 unit. Conversely, if the stock price falls to 98.5, the lower grid will trigger a buy order at "ask 1" for 1 unit. |
| Qty for each order | The quantity of orders executed when the stock price fluctuations trigger the configured grid. |
| Validity | Supports long-term orders. The options include DAY/GTD/GTC. |
| Multiple placement | If multiple orders are enabled, when the stock price jumps higher or lower by more than one grid, the number of orders corresponding to the multiple will be entrusted according to the number of covered grids. |
| Holding scale | If you turn on position interval control, you can set the maximum and minimum positions. When the grid is triggered and an order is placed, it will be checked to see if it exceeds the position interval. If it exceeds, no order will be placed. |
Note: Grid trading does not support pre-market/after-hour trading of US stocks and auction trading of HK stocks.