#SpotVSFuturesStrategy
A Spot vs Futures strategy involves using both markets to either hedge risk or make profits from price differences. For example, traders may buy an asset on the spot market and simultaneously sell it on the futures market when futures are priced higher, locking in a risk-free profit—this is called arbitrage. Another common use is hedging, where investors holding crypto on the spot market use futures to protect against price drops by opening short positions.
This strategy can also earn passive income through funding fees on perpetual futures contracts. For instance, when funding rates are positive, shorting futures while holding spot allows traders to collect payments over time. However, these strategies require careful risk management, as futures carry liquidation risks and demand close monitoring of margin, fees, and market movements.
