Crypto Academy Week 3 Homework Post for @besticofinder - Spot trading and Margin trading

Hello everyone hope you all are fine. Yesterday i attend third lecture of @besticofinder which was all about the the spot trading. I learn it vary well. Now i am going to submit my home work post. In this post i will talk about the spot trading its advantages and disadvantages and margin trading and its advantages and disadvantages, also i will cover some more relevant topics of my home work.

What is spot trading

Spot trading is quick trade that means in spot trading traders buy and sell their assets instantly. In spot trading trade have a put a buy or sell order at any price just like i am buying butcoin at 50 thousand dollar.i put the order when the price of bitcoin will reach this price our order got successful instant. In spot trading there are buyers and sellers when the price of buyer and seller matches then trade will happen. Also spot trade is vary easy and risk free this trade is best for the new members in trading as it is vary easy to trade and understand it. In spot trading we buy some assets for the other asset.

How to do spot trade on binance

For spot trading on binance we need to open the binance first and login your account. After that we need to click on search bar on the top right side of binance home page.

Type of asset or currency you want to buy or sell. Then click on buy or sell option on the bottom .

Then we need to put the amount at which you want to buy or sell in the box. And click on sell or buy botton. When the buyer and seller price matches your order will get confirmed.

ADVANTAGES AND DISADVANTAGES OF SPOT TRADING

Advantages

1.In my opinion the best advantage of spot trading is it is simple and best of new members in crypto world.

2.Spot trading has stop limit option which can save a trader from a huge loss.

3.spot trading is instant and there us no way ti lose your founds just like in p2p trading.

4.Traders can hold in spot trading if they didn't find any interested current price.

Disadvantages

1.In spot trading you can't borrow any crypto sometimes you have small amount and you want to buy a lot but you can't do this in spot just like in margin trading. So there you can only there with your own assets.

2.Spot trading can present risks for the volatile assets.

WHAT IS MARGIN TRADING

In margin trading trader makes the trade using the assets provided by a third party. In margin trading traders borrows some money from the other person and gives a small benifit to third party and he makes trade from the borrowed money. In margin trading traders can access greater amount of assets to trader. In Margin trading you can get the benifits according to the demand of that asset at that time. In margin trading you need to be careful because there is high level of risks. In margin trading there is margin levels which shows thr risk levels. Risk level moves according to the movement of market. When margin level reaches the 1.1 your assets will automatically and will be paid to the third party.

How to do margin trading on binance

1.Login the binance account first.click on margin account in binance wallet.

2.Now you need to send some money to your margin account for that you need to click on transfer and send money to your margin account.

3.Now click on borrow money option and put the amount you want to borrow with interest rate.Fund will be deposit to your account vary quickly.

4.Now you can trade with these assets.

Advantages

1.In margin trading trader can buy a good number of assets having a small amount in his margin account.

2.in margin trading trader can get good profits due to the greater relative value of the trading position.

Disadvantages

1.In margin trading there is a good amount of interest on borrowing money so during trading yoh need to focus on it too.

2.In margin trading small dip in market can give substantial losses to traders so you need to put risk management properly.

THANKS FOR READING.

I request to my teacher @besticonfinder check my homework.

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