#SpotVSFuturesStrategy

Typically used to compare trading strategies between the Spot market and the Futures market. Here’s a simplified explanation of each market with the basic strategies and differences:

✅ What is trading in the Spot market?

Immediate delivery: When you buy a currency like BTC in the Spot market, you own the asset directly.

Example: You buy 1 BTC for $60,000 → you now have 1 BTC.

Strategy:

Buy and hold (HODL)

Buy at lows and sell at highs

Day trading without using leverage

✅ What is trading in Futures?

You do not own the asset directly: You trade on the price of the asset without owning it.

Leverage: You can trade with amounts larger than your balance.

Example: You open a trade on BTC with 10x leverage of $1,000 → you trade as if it were $10,000.

Strategy:

Buy (Long) if you expect an increase

Sell (Short) if you expect a decrease

Use stop loss and manage risks carefully

🔍 Quick comparison: Spot vs Futures

Item Spot Futures

Ownership Own the currency Do not own the asset

Leverage No Yes (up to 125x on some platforms)

Risk Relatively low High due to leverage

Usage Long-term investment Short-term trading for quick profits

📌 When to use each type?

✅ Spot: If you are a beginner or want a safe investment.

⚠️ Futures: If you are a professional and understand risk management well.