#TradingTypes101

Spot trading, futures, and options — what’s the difference?

In spot trading, transactions are executed instantly at the current market price. This is the simplest type of trading, ideal for beginners. Futures are contracts to buy/sell an asset in the future at a predetermined price. They allow for leverage but carry higher risks. Options give the right, but not the obligation, to execute a transaction — a flexible tool for hedging or speculation. The choice of trading type depends on your experience, style, and risk management. Understanding the difference is key to building an effective strategy.