Position Exit

A Position Exit is the final action in the lifecycle of a trade, where the trader closes their position to realize profits or limit losses. This can be done manually by the trader or automatically by the protocol if the account hits a liquidation threshold.

The timing and method of the exit are crucial, as they determine the final outcome of the trade. In liquid markets, exits are smooth and have minimal impact on price, but in illiquid markets, exiting a large position can cause significant slippage.

A well-planned exit strategy is as important as the entry strategy, as it ensures that the trader captures value or exits before the position becomes a liability. Understanding the mechanisms of exit ⎊ whether through limit orders, market orders, or forced liquidations ⎊ is vital for effective risk control.