Q：What are the advantages of bot trading?
A1: Reduce Trading Risks:
Faced with market’s volatility, traders may make hasty or emotionally driven decisions. Bot trading follows preset standards to automatically execute transactions, minimizing emotional decision-making.
A2: Lower Operating Costs:
Bot trading automates and simplifies repetitive and detailed trading tasks, efficiently handling buying, selling, and other trading processes, thereby reducing operating costs.
A3: Optimize Trading Timing:
In a fluctuating market, the timing of trades is critical. Bot trading continuously monitors the market and executes trades in real-time, ensuring optimal timing.
Q: What is Bot Copy Trading?
A: Bot Copy Trading is a feature launched by Gate to help users more easily engage in digital asset trading using bots. Building on the foundation of traditional grid trading, Gate has introduced additional bot strategies to cater to the diverse needs of users. The strategy provider is called “Signaler”. The copier can copy the strategy of the signaler with one click for robot trading.
Q: How do novices start bot trading?
A1: Copy Strategy:
Bot beginners can refer to the “Bot Operation Guide“ to begin bot trading.
A2: Create Strategy:
The first step is to select the investment currency. The available strategies differ for single-currency and multi-currency investments. Next, determine the investment direction. The market direction you anticipate (up or down) will influence the applicable strategies. The specific steps are as follows:
A3: Operation Steps:
1. Select Investment Currency: For single-currency investments, proceed to step A4. For multi-currency investments, proceed to step A5.
2. Determine Trading Direction: If you anticipate the currency price will rise, see step A4.1. If you anticipate the currency price will fall, see step A4.2. If you are unsure about the price trend, see step A4.3.
A4: Single Currency Investment
When selecting a single trading pair like BTC/USDT, you can engage in both spot and futures trading. The primary decision is the transaction direction. Spot trading can only go long; margin trading can go long or short; and futures trading can go long, short, or neutral.
A4.1 Determine Trade Direction: Expect the Currency Price to Rise
If you predict a rise in the currency price, consider these options: Option 1: Spot trading without leverage. Utilize spot grid trading by following these steps: For the spot grid, operate by following the following steps:
Choose the price range. Set the number of grids. Set take-profit and stop-loss levels.
For more information about the spot grid operation guide and parameter settings, please refer to: Spot Grid Trading Guide
Option 2: Margin trading for amplified profits. For higher capital efficiency and amplified profits with greater risks, consider:
1. Margin Grid (Long): Margin Grid (Long) trading is an advanced strategy that enhances traditional spot grid trading by using leverage to potentially increase profits. Used within the context of spot trading, it offers better liquidity but comes with additional borrowing fees and is subject to the rates applicable to spot trading. 2. Futures Grid (Long): Futures Grid (Long) trading is a strategy used in perpetual futures markets that offers lower fees and the potential for higher returns. It is recommended for mainstream cryptocurrencies like BTC and ETH. While higher leverage can increase profits, it also raises risks. To minimize the risk of liquidation, it is advised that beginner traders use leverage below 5x for BTC and ETH futures. For other cryptocurrencies, leverage should be kept below 3x. To operate with Margin Grid /Futures Grid, follow the following steps:
Select price range
Select going long
Select leverage ratio
Set number of grids
Set take-profit and stop-loss levels
Note: The Margin Grid / Futures Grid trading process is similar to spot grid trading, with additional steps for selecting the trading direction and leverage ratio.
For more information about Margin Grid /Futures Grid, please refer to: Margin Grid Trading Tutorial Futures Grid Trading Tutorial
Tips: Gird Trading FAQ
Why is my grid trading strategy experiencing losses immediately after implementation? Does this indicate a flaw in the strategy?
1.Grid trading strategies usually take time to show their full potential. Maximum profits are generally achieved after the coin price has increased over a period. In fact, many classic grid trading strategies see initial losses before they start to become profitable.
2.Users may not fully understand the essence of grid trading. The returns from a grid strategy (or any type of copy trading strategy) consist of two parts:
-The first part is trading profit (grid profit), which is the profit from each individual trade. -The second part is floating profit and loss, which is the profit or loss due to changes in the coin price when no trades are occurring.
For example, according to strategy S, a user buys one unit of a certain currency (let’s call it B coin) at a price of $1, thus holding one unit of B coin. If the price of B coin then drops to $0.8, the value of the user’s one unit of B coin decreases from $1 to $0.8, resulting in a floating loss of ($0.8 - $1) * 1 = -$0.2.
In this situation, even if no trades occur, the user’s account value decreases due to the drop in the coin price, resulting in a negative floating profit and loss. This example explains why some users see losses before completing a full set of trades. The user buys a certain amount of coins through the grid strategy, but before selling, the coin price drops, causing a negative floating profit and loss in the account. When the coin price rises again, the floating profit and loss will turn positive, increasing the account value.
A4.2 Determine Trade Direction: Expect the Currency Price to Fall
If you expect the price of the cryptocurrency to decline, you can opt for shorting with margin grid or futures grid trading. Shorting with grid trading helps you sell part of your holdings at a high real-time price and then buy back at a lower price, thus earning the difference. When using a bearish grid strategy, beginners should avoid setting the leverage too high. It is recommended that novice users choose leverage below 5x for BTC and ETH futures and below 3x for other cryptocurrencies to reduce the risk of liquidation. The steps for shorting with margin/futures grid trading are similar to those for longing with margin/futures grid trading and include the following:
Select the price range
Choose the short direction
Select the leverage ratio
Set the number of grids
Set take-profit and stop -oss levels
A4.3 Determine Trade Direction: Difficult to Predict Market Trend
If you find it difficult to predict future market trends, you can opt for a futures neutral grid strategy.The neutral grid strategy allows investors to go long and short after price movements occur, so you don’t need to accurately predict market direction. By enabling trades in both rising and falling markets, this strategy minimizes the risk of losses due to incorrect market predictions. Learn more about Futures Neutral Grid: Futures Grid Trading Tutorial
A5 Multi-currency Investment
When investing in multiple cryptocurrencies, you can choose between two strategies. The first is straightforward: manage each currency individually using the single-currency investment method.
The second, more complex but convenient, is the smart rebalancing strategy, suitable for bullish markets. This method is ideal when you believe in stable price relationships between your chosen currencies (e.g., BTC/ETH, or or similar concept coins) and are optimistic about their future performance.
Smart rebalancing involves rebalancing your portfolio by selling a portion of fast-rising assets to buy slower-rising ones, maximizing returns and automatically accumulating more coins. By using the profits generated from one rising asset to increase the position in another asset, you can achieve profit compounding.
For detailed guidance, please refer to the Smart Rebalancing Help Document.
Gate reserves the final right of interpretation for this product.
Q：Are there any fees for using trading bot?
A：It depends on the type of bot you use. Bots that copy strategies from signal providers require a profit-sharing fee, currently between 5% and 30%. The platform also offers free bots that users can copy and create. For bots you create yourself, you only need to pay the trading fees. Additionally, Gate has introduced some zero-fee bots for users.
Q：Calculation Method of Floating Profit and Loss
A：1）Why is the floating profit negative when the entry price is lower than the current price? To better understand the concept of “floating profit and loss,” let’s introduce two formulas:
Floating Profit and Loss = (Current Price - Average Buy Price) * Quantity Held Entry Price: The price at which the first transaction was made after the grid was created.
A：2）According to the floating profit and loss formula, we can see two key parameters: “Current Price,” which is the current market price, and “Average Buy Price.” So, what is “Average Buy Price”?
Let’s use the GT_USDT trading pair as an example: Price of GT_USDT when the strategy was created: 30 USDT Grid price range: 30 - 100 USDT Grid interval: 10 USDT At the time of grid creation: The current price of GT_USDT is 30 USDT, and the average buy price is 30 USDT. According to the floating profit and loss formula, the floating profit and loss at this time is 0.
After the grid has been running for a while: Assume that during the grid operation, the price of GT_USDT rises from 30 USDT to 100 USDT and then falls back to 40 USDT. During this period, the bot strategy performs the following operations: As the price rises from 30 USDT to 100 USDT, the strategy sells at each grid interval of 10 USDT at prices of 40 USDT, 50 USDT, 60 USDT, 70 USDT, 80 USDT, 90 USDT, and 100 USDT, earning grid profits.
Next, as the price falls from 100 USDT to 40 USDT, the bot buys at each grid interval of 10 USDT at prices of 90 USDT, 80 USDT, 70 USDT, 60 USDT, 50 USDT, and 40 USDT.
Therefore, during the price decline, based on the strategy’s buy prices at six different levels, we can calculate that the average holding price is 65 USDT, which is higher than the current market price of GT_USDT at 40 USDT. Thus, the current price minus the average buy price is negative, resulting in a negative floating profit and loss.
Explain the calculation in table:
Q： What is the Bots Trial Fund?
A：Bots Trial Fund is a virtual fund that can be used for various purposes in bot trading. It can be utilized for margin trading (applicable in both spot and futures markets), offsetting account losses, paying trading fees, and covering related funding costs. The Bots Trial Fund is designed to allow both new and existing users to experience the functionalities of bot trading risk-free, helping them better understand and utilize bot trading strategies.
Q：Explanation of Bots Trial Fund
A：1）Gate Bots Trial Fund is distributed directly;
A：2）Users can obtain Bots Trial Fund by participating in designated promotional activities;
A：3）Users can view their Bots Trial Fund in the “Assets”-“Copy Trading”;
A：4）The Bots Trial Fund can be used as an investment principal, serving as a margin for bot trading or offsetting account losses, trading fees, and funding costs;
A：5）Bots Trial Fund allows users to participate in bot trading with zero investment;
A：6）Bots Trial Fund includes “Trial Fund for Bots Copier” and “Trial Fund for Bots Provider.” As the names suggest, “Trial Fund for Bots Copier” is intended for users who copy trading strategies, while “Trial Fund for Bots Provider” is meant for users who create and provide trading strategies.
Q：How is the Bots Trial Fund deducted?
A：1）The Bots Trial Fund will be deducted before the account’s own principal;
A：2）Profits earned from trading with the Bots Trial Fund can be withdrawn.
Example Scenario: User A has 50 USDT of their own funds and 100 USDT in the Bots Trial Fund in their account. User A engages in bot trading. After the first trade closes with a loss of 80 USDT, the loss is deducted from the Bots Trial Fund first, leaving 20 USDT in the trial fund and the 50 USDT of their own funds unchanged. If User A then conducts another trade and earns a profit of 20 USDT, the trial fund stays at 20 USDT, but their own funds increase to 70 USDT. The profit from this trade can be withdrawn.
Q：What are the Limitations of the Bots Trial Fund?
A：1）The trial fund cannot be withdrawn;
A：2）Once the trial fund is added to your account, it is only usable for a set period. If you don’t use it all before the deadline, the system will automatically take back the unused portion. This could lead to forced liquidation of your trades if you don’t have enough other funds to cover your open positions.
A：3）The Bots Trial Fund can be used for spot and futures trading with specific pairs like: BTC/USDT, ETH/USDT, GT/USDT, EOS/USDT, XRP/USDT, BCH/USDT, ADA/USDT, LTC/USDT, DASH/USDT, LINK/USDT, BNB/USDT, XLM/USDT, DOGE/USDT, SHIB/USDT, DOT/USDT, VRA/USDT, LUNA/USDT, FIL/USDT, MATIC/USDT, and UNI/USDT. Note that the pairs it supports are not exactly the same as those supported by the perpetual futures bonus.
Q：Path To View Bots Trial Fund Balance
Q：Are the fees for using bots the same as traditional trading fees?
A：Yes, the fees for using trading bots are the same as the fees for traditional trading. VIP users will also get the same discounts on fees when using bots.
Q：Do I need to keep the app open for the strategy to keep running?
A：No, you do not. Whether the app is open or closed, it will not affect the operation of the trading bot.
Q：Is my fund safe?
A：Absolutely safe.
Q：Will the trading bot transfer my funds to someone else’s account?
A：No, your funds will always remain within your account and under your control,
Q：Has anyone made money using trading bots?
A：Yes, many users have earned profits using various strategies with trading bots. You can check the “Bot Leaderboard” for more information.
Q：Reasons for Strategy Operation Failure
A：When using a trading bot strategy, users may encounter failures in strategy operation. The main reasons for these failures are as follows:
1.The total number of strategies running on all markets/trading pairs (including paused strategies that have not been terminated) cannot exceed 50. Any excess will result in failure to create new strategies;
2.If the required funds for the strategy are insufficient at the time of creation, the strategy cannot be created (the system will automatically calculate the minimum required funds based on the strategy parameters, and the required funds must be met at the time of creation);
3.If the strategy parameters do not match the trading pair parameters at the time the strategy takes effect, the creation will fail (for example, in grid trading, if the latest price at the time the strategy takes effect is not within the upper and lower limit price range, the creation will fail).
Q：Reasons for Strategy Termination
A：The main reasons for the termination of a strategy during operation include:
1.Manually terminating the strategy;
2.Termination due to insufficient funds;
3.Strategies with set take-profit or stop-loss will terminate once these conditions are triggered;
4.If the strategy is set to terminate when the latest price breaks the upper or lower price limits, it will terminate when these limits are breached;
5.The strategy will automatically terminate if the traded cryptocurrency encounters unforeseen circumstances such as suspension or delisting during the strategy’s operation;
6.Futures or margin grids will terminate if a liquidation is triggered.
Q：How to set a stop loss for a strategy?
A：1）What is stop loss?
While cryptocurrencies offer the potential for high returns, they also involve high risks. The LUNA crash caused major losses for many investors, but those who had stop loss strategies in place greatly minimized their losses.
A stop loss is a critical part of a strategy, closing a position when losses reach a certain threshold to avoid further losses.
A：2）Why should we use stop loss?
Profitability depends not only on the profits you make but also on how efficiently you use your capital. Many investors are psychologically resistant to stop losses and hesitate to cut their losses early. As losses accumulate, they find themselves forced to take action to prevent further damage. They often rationalize their decisions by claiming they misjudged the market.
In the high-risk world of cryptocurrency, survival is paramount. You can only think about growth once you have enough assets. The primary purpose of a stop loss is to help investors reduce their positions in time to avoid larger losses. By keeping losses within a manageable range, investors can better survive and capitalize on the next profitable market opportunity.
A：3）How to set a stop loss?
Gate currently offers two ways to set a stop loss: One way is to set a fixed stop loss price. When the coin price falls below this price, the stop loss is triggered, and all coins will be sold.
Another way is to set a stop loss ratio. When the loss ratio of the investment amount >= the automatic stop loss ratio, the strategy will be terminated. You can set the stop loss method when creating the strategy.
A：4）How to set a stop loss on Gate?
1.Set a Fixed Stop Loss Price
2.Set a Stop Loss Ratio
Simple Explanation for Setting a Stop Loss Price
Example 1: Using the previous closing price of LUNA as an example, suppose you set a fixed stop loss price. When LUNA’s price falls below 45, it triggers the grid at 40, and all coins are sold. The actual loss calculation is:(40+40)-(80+60)]/(80+60)=-43%. If no stop loss is set and LUNA’s price continues to fall to 0, the loss would be 100%.
Example 2: Using the previous closing price of LUNA as an example, suppose you set a fixed stop loss ratio. When the price drops to 60, the expected loss calculation is: (60-80)/80=25%. When the actual loss ratio reaches or exceeds 20%, the system will automatically sell. If you choose to sell all at the price of 60, the actual loss would be 25%. If no stop loss is set, the loss could reach 100%.
