#TradingTypes101 : Explore the differences between Spot, Margin, and Futures trading.

In the world of trading, there are several ways to operate with assets, and understanding the differences between Spot, Margin, and Futures trading is fundamental.

Spot trading is the most direct and common. When you make a spot trade, you are buying or selling an asset (like Bitcoin or Ethereum) immediately at its current market price, and the ownership of the asset is transferred directly to your wallet. It is ideal if you seek to have actual possession of the asset and trade with your own capital.

Margin trading allows you to trade with more capital than you actually have by borrowing funds from the platform. This is known as "leverage." While leverage can amplify your gains, it can also magnify your losses, making it a higher-risk option that requires careful management. Here, you do not acquire ownership of the asset; instead, you speculate on its price movement.

Finally, Futures trading involves buying or selling a contract that obligates you to buy or sell an asset at a predetermined price on a future date. You are not trading the asset itself but a contract that represents its value. Futures are widely used for hedging risks or speculating on future price movements without having to own the underlying asset. They also often offer leverage.