#SpotVSFuturesStrategy

Here’s a brief explanation of **Spot vs Futures** strategies

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### **Key Difference:**

- **Spot:** Buying a real asset (like BTC) and holding it; you profit if its price rises.

- **Futures:** Trading derivative contracts (without owning the asset); you profit from both upward **and downward** price movements using leverage.

### **Common Strategies:**

1. **Hedging:**

- Buy an asset in **Spot** (e.g., ETH).

- Open a **Short** position in Futures to protect your portfolio from market collapse.

2. **Arbitrage:**

- Take advantage of price differences between the **Spot** market and Futures (e.g., when Futures are at a higher price *"Contango"*).

3. **Trend Trading:**

- Use **Futures** with leverage (×10, ×20) to amplify your profits if you anticipate a strong trend (upward or downward).

4. **Funding Rate:**

- Open a **Long/Short** position in Futures to earn the **"Funding Rate"** if it is positive.

### **Key Tips:**

- **Risk:** Futures are riskier due to leverage (you may lose more than your capital).

- **Timing:** Futures are suitable for short-term volatility, while Spot is for long-term investment.

- **Practice:** Use a demo account first!

- **Binance Tools:** Use **Take Profit/Stop Loss** and profit calculator to avoid

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