Binance Futures has launched the Time-Weighted Average Price (TWAP) trading algorithm at 2022-04-27 06:00 AM (UTC) for API users on USDⓈ-M Futures. Part of the Binance Futures Execution Algorithm API solutions, the TWAP trading algorithm allows users to programmatically leverage Binance’s in-house algorithmic trading capability to disperse large orders into smaller quantities, automatically executing these orders at regular intervals to minimize the impact on market prices.
What is the Time-Weighted Average Price (TWAP) trading algorithm?
The TWAP trading algorithm is an algorithmic trade execution strategy that aims to achieve an average execution price close to the time-weighted average price of a period specified by the user. Traders usually deploy TWAP strategies to execute large orders while mitigating the market impact, by slicing the orders across a specific time duration.
TWAP strategies are favored to provide a better execution price in the following scenarios:
- Order size larger than available liquidity on the order book.
- Anticipation of high price volatility with no clear upward or downward trend.
How to use the TWAP trading algorithm?
The TWAP trading algorithm is available via Binance Futures API connectivity suite, and open to all users with Binance Futures API trading enabled.
For more information:
- How to Use Time-Weighted Average Price Algorithm on Binance Futures
- Binance Futures Algo API Document
Risk Warning: Futures trading carries substantial risk and the possibility of both significant profits and losses. Past gains are not indicative of future returns. All of your margin balance may be liquidated in the event of extreme price movements. The information here should not be regarded as financial or investment advice from Binance. All trading strategies are used at your discretion and your own risk. Binance will not be liable to you for any loss that might arise from your use of Futures. To learn more about how to protect yourself, visit our Responsible Trading resource page.
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Binance reserves the right in its sole discretion to amend or change or cancel this announcement at any time and for any reasons without prior notice.