#SpotVSFuturesStrategy When deciding between spot and futures trading strategies, consider the following key differences ¹ ²:
*Spot Trading:*
- Direct ownership of assets
- No leverage or limited leverage
- Lower risk
- Suitable for long-term investments
- Immediate delivery
*Futures Trading:*
- Contract representing the asset
- High leverage available (up to 100x)
- Higher risk due to leverage
- Suitable for speculation, hedging, and short-term trading
- Future delivery
Some popular futures trading strategies include ¹:
- *Hedging*: offsetting potential losses in spot holdings
- *Funding Rate Arbitrage*: profiting from funding rate differences
- *Volatility Trading*: capitalizing on anticipated price movements
- *Automated Trading*: using bots to execute trades based on predefined strategies
Choose spot trading for long-term investments and lower risk, or futures trading for short-term gains and higher leverage, but be aware of the increased risk ².