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Glossary

Here you will find clear definitions and explanations of essential trading terms and concepts

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Written by Zent Support
Updated over a week ago

PnL (Profit and Loss)
A generalized term for profitability indicators, which may include statistical information on returns for a specific period or overall. This encompasses both realized and potential profitability.

Position
Also known as an internal position to distinguish it from exchange futures positions. An internal position is an entity that represents a set of one or more buying or selling operations (entering a position) to make a future profit from the reverse sale or purchase of these assets (exiting the position) for a specific pair (specifically, a pair, not a coin). A position has a volume (amount), entry price, and direction. The volume determines the direction – positive volume indicates a long position, while negative volume indicates a short position.

Position Operations:

  • Opening: The initial purchase or sale of an asset (e.g., buying BTC in the pair BTC/USDT). Upon opening a position, the Unrealized Profit/Loss ([UPL]) starts to be calculated immediately.

  • Full Closure: Buying or selling (depending on the direction) of an asset (e.g., selling the same BTC in the pair BTC/USDT) and locking in the profit ([RPL]).

  • Addition: Additional buying or selling of an asset. For instance, when having a long position in the pair BTC/USDT, buying an additional amount of BTC in the same pair constitutes an addition to the position. The entry price is recalculated as the weighted average.

  • Partial Closure: Buying or selling (depending on the direction) of an asset (e.g., selling the same BTC in the pair BTC/USDT) for a partial volume of the position (e.g., 5 BTC out of the previously purchased 10 BTC). In this case, only the profit from the partial volume is fixed, and an open position remains for the remaining volume, with the Unrealized Profit/Loss ([UPL]) recalculated.

  • Reverse: Closing a position for a volume greater than the volume at opening. Essentially, it is a complete closure of an existing position and the opening of a position in the opposite direction (e.g., to sell 12 BTC after buying 10 BTC in the pair BTC/USDT, the long position for 10 BTC is fully closed, the profit is realized, and a short position for 2 BTC is opened). In this case, the entry price for the updated position is the price at the time of the transaction. Also, the position fixes a realized profit ([RPL]).

  • Position Direction (Short/Long)
    Reflects the type of operations for opening and closing a position. A purchase is made to open a long position, and a sale is executed for a short position. Accordingly, the previously acquired asset is sold to close a long position, and the previously sold asset is repurchased to close a short position.

  • UPL (Unrealized Profit/Loss)
    An indicator that displays the volume of potential revenue in the quoted currency when closing a position at the current price. It is recalculated with each price change.
    Calculated by the formula: pos_amount * (current_price - entry_price).
    Example: Suppose a long position was opened in the pair BTC/USDT for 10 BTC at a price of 50,000 USDT. Since then, the price has risen to 60,000 USDT. In this case, the UPL would be 100,000 USDT.

  • RPL (Realized Profit/Loss)
    An indicator that displays the volume of fixed revenue in the quoted currency from closing a position.
    Example: Suppose a long position was opened in the pair BTC/USDT for 10 BTC at a price of 50,000 USDT. When the price reached 60,000 USDT, the position was fully closed. The realized profit (RPL) amounted to 100,000 USDT.

  • Trade
    An entity that describes a specific completed buying or selling operation on an exchange. Essentially, each trading operation generates two trades — one on the purchase side and one on the sale side. A trade occurs when two orders are matched in the order book with equal or better prices. In the case of multiple matching orders, preference is given to the most favorable exchange rate.

Commission

The commission amount is a certain percentage of the order volume. This percentage may vary depending on whether the order is a taker or a maker, as well as the account level (often, the higher the monthly turnover, the higher the account level). In some cases (on certain exchanges), the commission may be negative, meaning a reward will be credited to the balance for executing a trade, albeit in a very small amount and subject to various conditions.

In most cases, the commission is paid in the base currency of the trade and levied on the order volume. For example, when buying 1 BTC with a 1% commission, the balance will be credited with 0.99 BTC. In some cases, the commission may be calculated not in the base currency but in a different one. For instance, on Binance, you may pay the commission in BNB, enjoying a 25% discount.

Order

The minimum trading unit available to the user. In exchange trading, a user places orders to buy or sell. The execution of orders occurs through trades. One order may be executed through multiple trades at the price specified in the order or a better one.

Types of Orders and Their Execution

Currently, we use two types of orders — Market and Limit. When placing a Limit order, it will be executed at the specified price or better (more details in the Trades article) until the entire order volume is filled or the order is canceled by the user. A Market order does not include a specified price and is executed immediately for the entire volume, covering any opposing Limit orders, starting from the most favorable one until its entire volume is filled.

Market Delta

Delta serves as a risk metric, providing an estimation of how the price of a derivative, like an options contract, might change with a $1 shift in its underlying security. Delta also conveys the hedging ratio for options traders aiming to achieve delta neutrality. Depending on the option type, delta values may be positive or negative.

  1. Spinner Daily Volume
    It is a volume a spinner must trade within a day in the base currency — typically determined randomly within a specified range from the minimum to the maximum value.

  2. Spinner Filled Daily Volume
    It is a volume already traded by a spinner during the given day (from 00:00 to 24:00 UTC).

  3. Price Step Size
    It is the minimum value by which the order price can be increased. For example, if the price step size for the BTC/USDT trading pair is 0.0002, the price can be increased/decreased by this value but not by 0.0001. In other words, the price is considered valid if it is a multiple of the price step size.

  4. Amount Step Size
    It is the minimum value by which the order volume can be increased. Please do not confuse it with the minimum order amount: these values rarely coincide; usually, the minimum amount step is much smaller than the minimum order amount. For instance, if the amount step size for the BTC/USDT trading pair is 0.00002 BTC, and the minimum order amount is 0.0001 BTC, the volume is considered valid if it is equal to or greater than 0.0001 BTC and also a multiple of 0.00002.

  5. Order Rule

General Information

An Order Rule is a set of rules that describe the logic of executing trades when a market instrument meets certain conditions. The fundamental idea behind Order Rules is the deferred execution of trades upon reaching the desired price with minimal market impact.

Types of Order Rules

Currently, one type of Order Rule has been implemented — the basic one, with two more advanced types planned. The Basic Order Rule, also known as the Common Order Rule, operates with a single exchange and symbol and has only one trigger for execution. The other two types of Order Rules are the Hedged Order Rule and the SL/TP Order Rule — these can operate on multiple legs or have different triggers for execution.

Common Order Rule

Operating Principle: When creating a Common Order Rule, trading services begin monitoring the price of the specified instrument. Upon reaching the target price, orders of the specified size are placed.

Orders continue to be placed at intervals as long as the price conditions are met and if the previous order is closed (fully executed or canceled), until the entire volume of the Order Rule is executed or a critical error occurs (e.g., insufficient funds).

Fields of an Order Rule and their purposes:

  • Exchange — the exchange;

  • Symbol — the symbol;

  • Order Type (Limit/Market) — the type of orders to be placed on the exchange;

  • Order Side (Buy/Sell) — the direction of the orders to be placed. Also determines which price is tracked (for Buy — ask, for Sell — bid);

  • Price — the price at which execution (order placement) will occur. For Limit orders, this is the same price;

  • Total Amount — the total volume at which the Order Rule will be considered completed (Completed);

  • Order Amount — the volume of a single order;

  • Interval — the time interval between placing orders in milliseconds.

Hedged Order Rule

The Hedged Order allows the trader to be both short and long at any particular pair by including their position at zero. For example, when the price is reached, the placing of buy orders commences on the spot section. Upon their successful full or partial execution, a sell order is also placed for the same (or another specified) asset in the same volume.

Either or both of the legs may be on the spot or futures section. The key difference lies in the trigger price for execution.

Additional fields and their purposes:

  • Hedge Exchange — the exchange where Hedged Orders should be placed.

  • Hedge Symbol — the symbol for which Hedged Orders should be placed. The base coin for both Symbol and Hedge Symbol must be the same, while the quote coin may differ (by default, looking for a perpetual contract for the same symbol).

  • Hedge API Key — the API key used when placing orders on the hedging exchange.

Statistics

Hedged Order Rules have a different representation in Statistics. An executed rule constitutes two opposing positions — one on the spot section and the other on the futures section. The difference in the current prices of these assets represents the UPL.

If the symbols on the spot and futures sections differ, the prices for calculating UPL will be converted to USDT. This same UPL can be realized by converting it into RPL by executing a Hedged Order Rule in the opposite direction. For example, if a position was opened by a rule that bought on the spot and sold on the futures, you can place the same rule in the opposite direction (selling on the spot and buying on the futures). Upon execution, it will realize RPL with the previous rule.

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