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Updated May 2026 — NYXANCE Glossary
Grid trading is an automated strategy that places a series of buy and sell orders at predetermined price intervals (a "grid") above and below the current market price. Each time the price oscillates within the grid range, the bot sells highs and buys dips, capturing small profits on each oscillation. When applied to perpetual futures, grid trading can also be run with leverage and on the short side.
Suppose BTC/USDT is at $67,000. You create a grid between $60,000 and $74,000 with 14 levels, spaced $1,000 apart:
$74,000 — Sell $73,000 — Sell ... $68,000 — Sell (current + 1) [$67,000 — Current price] $66,000 — Buy $65,000 — Buy ... $60,000 — BuyThe bot places:
Execution logic: When price rises to $68,000 and a sell executes, the bot immediately places a new buy order at $67,000 (one grid level below). When price falls back to $67,000 and that buy executes, a new sell is placed at $68,000. Each round trip ($67K → $68K → $67K) earns:
Profit per grid = Grid Spacing / Entry Price = $1,000 / $67,000 = 1.49% Less fees: 2 × 0.04% = 0.08% Net per grid cycle: ~1.41%Multiply by the number of oscillations through each grid level, and the returns compound over time.
| Feature | Spot Grid | Perp Grid |
|---|---|---|
| Leverage | None (1×) | 1×–20× |
| Short grid possible | No | Yes |
| Funding cost | None | Yes — can be positive or negative |
| Liquidation risk | None | Yes — requires margin management |
| Capital required | High (must hold underlying) | Lower (margin-based) |
Perp grid with leverage: 5× leverage means you can run a $100,000 grid position with only $20,000 in margin. All oscillation profits are amplified 5×, but so is the risk of being outside the grid range.
Short grid (Bear Grid): Instead of buying dips and selling rallies, a short grid shorts rallies and covers dips. Profitable in downtrending or high-negative-funding environments.
The grid works within its range. If price exits the range:
Rule of thumb: Set range to cover 2–3 standard deviations of the asset's 30-day price range. For BTC with 20% monthly volatility at $67,000:
Tighter grids → more frequent trades → more fee drag, but more oscillation profits. Wider grids → fewer trades → cleaner fills but larger per-trade profit needed to cover slippage.
Optimal grid spacing depends on the asset's average daily range and the maker/taker fee structure.
More grids within the same range → smaller per-grid profit → requires more oscillations to recoup fees. 10–30 grids is typical.
Works well:
Works poorly:
On perpetual grids, every open position accumulates funding rate charges. In positive funding (longs pay), a long-biased grid (which often holds long positions when price is near the bottom of the range) accrues funding costs. These must be incorporated into expected yield calculations.
Simple check: If expected grid oscillation yield is 2%/month and expected funding cost is 1.5%/month, the net yield is only 0.5%. In this case, a funding arbitrage strategy with no directional exposure may be more efficient.
NYXANCE's API supports automated grid strategies with low-latency order placement, real-time WebSocket price feeds, and maker rebates that improve grid economics. API documentation | Trade now.
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