How does slippage impact the profitability of crypto trading?

1 answers

• Karen CelebradoMay 04, 2024 · a year ago
  Slippage is an important factor to consider in crypto trading as it can affect profitability. It occurs when the execution price of a trade deviates from the expected price. Slippage is more likely to happen in volatile markets or when trading large volumes. For example, if you place a market order to sell a cryptocurrency and the price suddenly drops, you may end up selling at a lower price than you intended, resulting in reduced profits. Slippage can also be caused by delays in order execution or insufficient liquidity in the market. Traders can minimize slippage by using limit orders, setting stop-loss orders, and choosing exchanges with high liquidity and fast execution speeds.
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