Traders have the option to choose from different price types to trigger their conditional orders on Phemex. This feature gives experienced Phemex traders more control over customizing their conditional orders. It helps them execute a variety of trading strategies with greater accuracy.
1) Utilizing the Last Traded Price for triggering conditional orders (Default option)
Pros:
Orders are executed based on the platform's Last Traded Price (LTP). Employing LTP for triggering conditional orders allows traders to obtain a slightly more accurate estimate of the eventual order execution price.
Cons:
Particularly when using conditional orders to set stop losses, traders need to be mindful of the risk that their stop-loss orders may not execute before the position is liquidated. This risk arises because liquidation is triggered by Mark Price rather than the platform's LTP, due to the platform’s dual price mechanism
2) Employing Mark Price to activate conditional orders
Pros:
Using Mark Price to activate stop-loss orders, traders can ensure that their stop-loss orders will always be triggered before their position is liquidated.
Cons:
Orders are executed based on the platform's Last Traded Price (LTP). By utilizing Mark Price to activate conditional orders, traders should be cautious of the possibility that the final executed price of their stop loss may encounter price slippages due to price discrepancies between Mark Price and LTP at the trigger point.
