#SpotVSFuturesStrategy

A #SpotVSFuturesStrategy involves simultaneously trading an asset in the spot market (for immediate delivery) and the futures market (for future delivery at a predetermined price).

One common approach is arbitrage, exploiting temporary price discrepancies. For example, if the futures price is significantly higher than the spot price, a trader might buy the asset in the spot market and simultaneously sell a futures contract. As the futures contract approaches expiration, its price converges with the spot price, allowing the trader to profit from the initial spread. This strategy aims for low-risk gains by capitalizing on market inefficiencies.