Spot vs Futures Trading ⚖️
Spot Trading 🛒
- You own the asset immediately after purchase
- There is a document or record in the wallet/depot — proof of ownership 🗂️
- You can use the asset: wear, eat, rent, transfer ⚡️
- Long/short in spot:
- Long: bought for $100 → sold for $130 → +$30 📈
- Short: sold short for $100 → bought for $80 → +$20 📉
Futures Trading ⏳
- You do not own the asset, but trade a contract
- A contract is an obligation to buy/sell the asset in the future at a price 📃
- You can immediately go long (on the rise) or short (on the fall)
- Examples:
- Short futures on oil at $100 → price falls to $80 → profit $20 ✔️
- Long futures on gold at $1500 → price rises to $1600 → profit $100 ✔️
Key Differences:
Parameter:
- Spot 🛒
- Ownership: Yes
- Proof: Wallet, report
- Usage: Can spend, transfer
- Long/short: Through the asset
- Futures ⏳
- Ownership: No, only contract
- Proof: Digital/paper contract
- Usage: Only speculation
- Long/short: Directly through the contract