Advanced Order Types

Beyond Market and Limit Orders

Basic market and limit orders are enough to start trading, but advanced order types give you precision, better execution prices, and protection in volatile markets. Understanding these tools is essential for trading perpetual futures effectively.

Stop-Limit Orders

A stop-limit order combines a trigger price (the stop) with a limit price. When the market reaches the stop price, a limit order is placed.

Example: You are long BTC-PERP at $30,000 and want to exit if the price drops. You set a stop-limit with a stop at $29,500 and a limit at $29,450.

• When BTC hits $29,500, a sell limit order at $29,450 is placed.
• You get filled at $29,450 or better — but if the price crashes past $29,450 instantly (a flash crash), your order may remain unfilled.

Trade-off: better price control vs. risk of no execution. For fast-moving markets, stop-market orders may be safer.

Trailing Stop Orders

A trailing stop follows the price by a fixed percentage or dollar amount. It only moves in your favor and triggers when the price reverses by the trailing amount.

Example: You long SOL-PERP at $25.00 with a 4% trailing stop.

• SOL rises to $30.00 — your stop trails to $28.80 ($30.00 x 0.96).
• SOL drops to $28.80 — the stop triggers, locking in a $3.80 profit per SOL.
• If SOL had kept rising to $35.00, the stop would have moved to $33.60.

Trailing stops let winners run while protecting gains automatically.

TWAP Orders

TWAP (Time-Weighted Average Price) splits a large order into smaller equal parts executed at regular intervals.

Example: You need to buy $500,000 of ETH-PERP. Instead of one market order that moves the price, you set a TWAP over 2 hours. The system buys roughly $4,167 every minute for 120 minutes. Your average fill price closely approximates the true market price over that window.

TWAP is essential for large positions where market impact would significantly worsen your entry.

Iceberg Orders

An iceberg order shows only a small visible portion on the order book while hiding the full size. If you want to buy 1,000 ETH but only display 50 ETH at a time, you use an iceberg. As each 50 ETH slice fills, the next slice appears.

This prevents other traders from front-running your large order or adjusting their behavior based on your size.

Reduce-Only Orders

A reduce-only order can only decrease or close an existing position. It cannot open a new one in the opposite direction.

Example: You are long 10 ETH-PERP and set a reduce-only sell limit for 10 ETH at $2,100. If your position is already closed by a stop-loss before the limit is reached, the reduce-only order is automatically cancelled instead of opening a short.

This prevents the dangerous scenario of accidentally flipping into a position you did not intend to hold.

Post-Only Orders

A post-only (maker-only) order is guaranteed to be added to the order book as a passive order. If it would immediately match against an existing order, it is rejected instead.

Why use it? On most exchanges, maker fees are lower than taker fees — often 0.02% vs. 0.06%. For high-frequency or high-volume traders, this difference adds up significantly.

Trigger Orders on DEXes

Decentralized perpetual exchanges like dYdX, GMX, and Hyperliquid support trigger orders (sometimes called conditional orders). These function like stop-market orders: when the oracle or mark price hits your trigger, a market order executes.

Key differences from centralized exchanges:

• Execution depends on keepers or bots that monitor trigger conditions on-chain.
• In extreme congestion, trigger orders may execute with delay.
• Some DEXes charge a small execution fee (e.g., $0.50-$2.00) paid to the keeper.

Always check your DEX's documentation to understand exactly how trigger orders are processed and what price feeds they reference.