A critical component to any trading strategy is risk management, which helps you manage potential gains and losses. You may already be familiar with risk management tools such as traditional stop orders (stop-loss orders), stop-limit orders, and trailing stop orders. But beyond these risk management tools are bracket orders, accessible through advanced trading platforms like Bracket Trading on Koinfox
Every trader aims to maximize gains while protecting losses. While trading crypto not many exchanges offer you margin or leverage, so you need to own the respective coin first before you can sell it. On the other hand, there are exchanges, which offer margin even there an avid trader would want to use this complete margin amount to trade a larger quantity, instead of breaking a trade to half.
Imagine a Scenario, where you are witnessing a good volatility in a token. Let’s take an example of BTC. Say you see it going from 3400 to 3375 and 3450 in a day. So you have an opportunity of 75$. In a normal scenario, you will place a buy order at 3375 and wait for it to get completed. Once it is completed, you can either place a SL order or can place a Sell order. First thing is you can’t place both (sell & stop loss) orders unless you use leverage. Secondly, many exchanges, don’t even give you trailing stop loss. They only give you option of setting stop loss. In such a scenario possibility of trading above target becomes quite hectic, unless you are a full time trader.
Answer to above challenge is a simple Bracket order. Which is offered by Koinfox now on global exchanges. While some local exchanges offer this, cutting across multiple exchanges is not an option in absence if Koinfox.
A bracket order is an advanced order which has three orders merged into one. Where you start with choosing a token pair, defining it’s buy price, sell price and stop loss with trailing points. In this case, first your buy order will get executed, then a sell order will be placed by the system. While your sell order is in queue, koinfox market agents which are automated computer programs will continue to watch price of your scrip. In worst case scenario, if price of your selected token moves in the opposite direction than you anticipated, koinfox will cancel the sell order and place a limit/market order the moment price of the pair hit the selected stop loss target. This will cover your loss.
So if we look at the above example, I will place bracket with buy price at 3375 and sell at 3450 with stop loss at 3350 and trail at 25. Now in this case let’s say my order was bought at 3375 and price started to move in anticipated direction. If it touches 3450, my sale order will be executed and profit will be booked. However, in opposite situation, say price increased from 3375 until 3425 but did not hit 3450 because my trailing stop loss was at 25. My stop loss will be executed at 3400 so even in this case I will be able to make a profit of 25$. This in otherwise would not have been possible.
More interestingly, Koinfox is offering
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Moment we talk about exchange integration a question comes to our mind, do I need to share my exchange keys with this platform. What if this is a scam or this platform gets hacked. Well, Koinfox has very well anticipated this concern of retail investors and have therefore answered both the concerns in a very innovative manner.
Firstly, Koinfox has built a simulator with Binance where you can try the platform first before even linking your exchange keys with the dummy crypto tokens worth $30000 given to each logged in user during time of signup.
Secondly, after you feel comfortable and want to link exchange keys, you don’t need to place the in the central database of the system. You are given a native wallet for storing your API keys, every bracket order that you place on the platform first goes to the wallet for signing with your exchange keys before it is sent to the exchange. In this process, your keys are never stored in central database and hence reduces the risk any kind of breach of trust.
With all these innovative products and options KoinFox has just started the journey and they are claiming to be revolutionizing the way retail investors trade. Let’s see what more features they come up with in future. In the meanwhile, you can enjoy some brackets on www.koinfox.com
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Hitesh Malviya is the Founder of ItsBlockchain. He is one of the most early adopters of blockchain & cryptocurrency enthusiast in India. After being into space for a few years, he started IBC in 2016 to help other early adopters learn about the technology.
Before IBC, Hitesh has founded 4 companies in the cyber security & IT space.
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