Similar to Reduce-Only, the Close On Trigger function seeks to execute as a closing order that guarantees its execution regardless of margin requirements. The only difference is that a Close On Trigger Order serves as an additional option to Conditional Orders, it is an instruction to automatically close a position when a specific trigger condition is met, namely the certain price level reaches the trigger price.  

 

 

 

How does Close On Trigger work?

When the Close On Trigger option is selected for your Conditional Orders, the system will treat the order with the purpose of closing, therefore no margin is required for its execution upon the trigger. Simultaneously, it ensures that only the existing position will be closed, thereby preventing the unintentional opening of positions in the opposite direction.

When a Conditional Order with Close On Trigger is triggered: 

1. The system performs an evaluation to ascertain whether the triggered Conditional Order will reduce the contract quantity of the current position. If the order quantity specified in the Close On Trigger order exceeds the size of the current position, the system will auto-adjust the order quantity of the Close On Trigger order or cancel it if there is no open position to be closed. This proactive approach ensures that no unintentional positions in the opposite direction are opened.

 

2. For Conditional Market Order, it will be executed and filled in the best available market price upon triggered even when there is insufficient margin. 

 

3. For Conditional Limit Order, a Limit Order with Reduce-Only will be placed into the order book upon triggered and pending execution at the order price. Please note that there is no guaranteed execution for Limit Order and it may be executed immediately as a taker order if the order price is less favorable than the market price. For more information on how Limit Orders work, please visit here. 

 

 

 

Note: Bybit's Take Profit/Stop Loss (TP/SL) function available in Perpetual and Futures Contract trading has a Close On Trigger mechanism embedded. It offers users the ability to manage position risks more effectively by enabling them to set TP/SL orders easily. For more information, please refer to Introduction to Take Profit and Stop Loss (Perpetual and Futures Contracts).

 

 

 

Example 

Trader A currently holds a 1 BTC of  BTCUSDT long position at 25,000 USDT. He sets a conditional market sell order A at 30,000 USDT as a take profit order and a conditional market sell order B at 20,000 USDT as the stop loss order. Assuming the quantity for both orders is 1 BTC and the reference of the trigger price selected is the  Last Traded Price (LTP), below shows the outcome with or without selecting the Close On Trigger for the Conditional Market Sell Order.