Olivia Isakson uxBk
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#TradingTypes101
A lot of people get confused about the different types of trading, but it mainly comes down to two big categories: spot trading and futures trading.
In spot trading, it's pretty simple — you buy or sell crypto (or any asset) at the current market price. You actually own what you buy. For example, if you buy Bitcoin in spot trading, that Bitcoin is yours, and you can hold it, sell it later, or use it.
But futures trading works differently. Here, you're not buying the actual crypto — you're basically placing your money based on your analysis, predicting whether the price will go up or down in the future. It's kind of like a bet, and many people use leverage to boost their position. That means they borrow money to try to make more profit.
However, while the profits can be big, so can the losses. Some people lose everything if the market moves against them, especially when they don’t manage risk properly. So, while futures can be exciting, they’re also much riskier than spot trading.
A lot of people get confused about the different types of trading, but it mainly comes down to two big categories: spot trading and futures trading.
In spot trading, it's pretty simple — you buy or sell crypto (or any asset) at the current market price. You actually own what you buy. For example, if you buy Bitcoin in spot trading, that Bitcoin is yours, and you can hold it, sell it later, or use it.
But futures trading works differently. Here, you're not buying the actual crypto — you're basically placing your money based on your analysis, predicting whether the price will go up or down in the future. It's kind of like a bet, and many people use leverage to boost their position. That means they borrow money to try to make more profit.
However, while the profits can be big, so can the losses. Some people lose everything if the market moves against them, especially when they don’t manage risk properly. So, while futures can be exciting, they’re also much riskier than spot trading.
Disclaimer: Includes third-party opinions. No financial advice. May include sponsored content. See T&Cs.
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