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Before starting their journey in cryptocurrency trading, one of the major confusion that the traders have been facing every time is spot trading or margin trading & which one is suitable for us. These are the two trading options given to the traders that you have to decide before begin your trading journey. In the article, let's discuss spot vs margin trading, and also you can choose from it.

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Margin trading is just doing spot trading with borrowed funds.
Do your spot trading and when you are confident that you can bring in a profit, you can try trading with some margins. Don't take margins unless you excel your spot trading strategies. Profit and losses both are increased on margin trading.

Sorry, but this is not the proper board for this thread.
You may move this to Trading Discussion https://bitcointalk.org/index.php?board=8.0

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Anyway,
That sounds interesting OP. This is a big help for new traders to have a clear direction and have enough understanding of trading both Spot and Margin Trading. Risk can be manageable enough if we know how to adjust and handle the hard situation in trading. Some traders did quit because they don't find themselves fully aware of what will happens next. And they don't know a certain trading strategy suited to them.

This, anyone thinking on using margin trading must first succeed at spot trading, if you cannot then you are going to fail even harder when using margin trading, it is better that all traders start by spot trading since it is known that 90% or more of the traders lose all their money anyway regardless of the way they trade, if you use margin then that process is going to be accelerated and you are not going to get enough experience to correct the mistakes that you make which is why margin trading is only recommended for advanced traders and beginners should stay away from it.

I think these question is basically for traders because they have to know the option that is suitable or preferable for trading, because I found out that while some traders get lost and some of them gets profited via trading it's because of lack of research that will enable people who adventure into trading and also for those who are interested or wants to adventure into trading unit, so traders have to study or carry out proper research for margin trading or trading, so I only advice people who are novice via trading to study effectively in order to make a better profits without ending up with multiple lost.

The choice between spot trading and margin trading for someone whose crypto trading journey has yet to start is not a confusing one for me.

For me spot trading is the better option for a newbie. Your cryptocurrency journey will always begin with you as a newbie. And a newbie should stay away from margin trading. I am not someone who could give an expert's advice on trading but I think the use of leverage is not suitable for someone who has just entered the volatile world of crypto trading.

Margin trading is a double-edged sword that can either give a trader wealth or cost them money. Margin transactions are often subject to an hourly or daily loan charge.
Spot trading allows traders to execute a single order for a fixed fee. If we trade the wrong strategy, we can still wait for the market to recover capital.
Depending on the strategy and level of risk management, investors can choose a suitable trading method.

And this is where people do blown up their trading capital on where they do jump into margin/leverage without sufficient knowledge or background with spot ones.In result?
Some people will blame off and would go back to square one.Talking about the best strategy then it will really be different on each person because it might work for others but
it wont work for you thats why we do make our own trading styles which would involved lots of trial and error which cant really be attained on a short spot of time.
People would just realized when they do already get some experience on it and will surely tell that it wont really be that easy.

In short, margin trading is more profitable but on the other hand the more risk too.
Additional tip especially for newbies out there that may start to trade cryptocurrencies, I really suggest they will first start to trade in spot trading, which is more newbie-friendly, and learn first there before jumping in margin trading.

Margin trading is too risk from spot trading . the choice of strategy depends upon the trader's choice. Because no one understands that more than you do. Based on your risk tolerance and knowledge of investing, you need to choose which is the right strategy for you. If you first time in trading try to spot trading.

That's right, just switch in margin trading if you able to make consistent gain in spot trading. A lot of traders are usually beginning in margin trading because of the high rewards that it can give to you, yes it is true that you can huge rewards there but the downside is also big wherein you can also lose huge in margin trading. I only advise those traders to do margin trading if they able to master their strategies. Do not also be blind by the rewards and make sure to understand the risk first. The higher the leverage the riskier it gets even though the rewards are also increasing. I usually do spot trading because I'm used to it and I have a winning rate in spot than in margin. I'm not yet used to use low time frame chart but my goal in this year is to make consistent gain in spot trading.

They are different trading types and you have to prepare, then practice and sharpen very different skill sets to get win and reduce losses.

• Spot tradings: if your calculation or forecast is wrong, you can switch to mid-term or long-term hold. Long-term investment mostly help you avoid losses and even get big profits. Over decades, financial market proves this and it is true for Bitcoin (not true with shit altcoins).
• Margin (leverage) tradings: it is very different.
  
  • With this type, most importantly you have to manage your greed and do quantitative calculations for your trade orders.
  • Without good methodology to caculate and estimate things: you will get losses or worst get liquidations.
  • Why liquidation is triggered?
  • How to calculate liquidation price (from chart)?
  • Quantitative analyses are vital
• With good skills, you can calculate good price to entry, choose relevant leverage for your order, and calculate good exit point. Don't forget to include deviations for your calculations

So go ahead and choose the one that fits you (and your skills)!

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My last advice

• Try to learn and improve your quantitative methodology and analysis skills.
• Never join margin (leverage) tradings if you don't have such skills
• If you are learning those skills, let's start off (and always) use very small capital for it
• Spot or margin, don't trade because of your emotions!

It depends on the skill of the trader in trading i think spot trading is better than margin trading the risk is much lower here the large amount of information obtained from financial markets helps traders to improve their risk management plans and follow their investment or trading strategies. Traders can also choose their trigger methods to make stop loss and profit for losses can reduce financial losses from negative results or misinterpreted market signals.

Spots trading and margin trading are the same you will just buy and sell your coins in this term.
But the difference is :

In spots, you buy a coin at a specific price no more no less, just the amount of the coin you have.
If you buy in margin trading you buy a coin with additional funds with the use of the leverage or borrowing funds to the exchange platform.

In spots, there is no liquidation.
In margin trading, there is because again you are borrowing money if you can't pay them you will become liquidated.

If you want to learn in trading you need to identify all you need first, if you will go to spots or margin but for me, the margin is one of the most profitable but riskier and spots is the safest investment of buying and selling of the coin.

You do not miss the very basic things in trading. Everybody who wants to get deep into it should learn charting. If you cannot make anything out of charts, you might not end up a good trader. And to balance it, you should also learn to monitor and keep track of developments. That's fundamentals in trading. Lastly, you should also maximize all the tools available. It is worth repeating over and over again that there is such a thing as stop loss.

Both are same with just one difference. In spot trading you use your own money and in margin trading, you borrow funds from the broker based on your deposit and play in the market. The trading strategies don't change here!

However, I really wouldn't suggest to use margin trading unless your risk taking appetite is high. You may just loose your entire deposit! Margin trading is really for the big boys!

I certainly do not suggest anyone to start margin trading on crypto market, you only should use leverage on markets and trading pairs that are not that volatile and do not increase or decrease in price that much, for example in Forex market AUD/USD had only increase of 1.31% today which is considered as kind of a big movement in Forex market since most pairs change less than 1% in price usually.

So if you are a trader in Forex market you could easily use 5x leverage on AUD/USD and if your prediction and TA turned out to be right instead of only 1.31% make 6.55% on that trade and if you lost that trade it wouldn't be a financial ruin, but when you trade crypto on leverage which is highly volatile by its very form and for example trade BTC/USD on 5x leverage which today had more than 6% increase you could have lost more than 30% in one single trade which is really a lot and bitcoin and every crypto can easily make over 20% move which that gets you to zero balance on 5x leverage if you're on the wrong side of the market, always think of the worst case scenario when it comes to trading.

Margin trading is making trading on an unknown fund that you will return by compulsion. It is more risky to borrow money and start trading but many traders don't understand it and they sign up for margin with high leverage. It doesn't give you confidence trading on a margin.

TBH, Margin trading is not a good strategy for the non-expert. Do you borrow money for this risk? The idea is not really good. I've been in that situation, I borrow a few dollars from my friend just for this, 2-3 days I'm still good but the moment when the market trend changing and causes for to wait longer in order before we can sell, that moment also you'll think negative and thinking how I can pay my debts now if I'm no longer making money from this.

That is the reason why I giving advice not to take this one if you don't have any resources otherwise, it compromises ourselves, our financial in the end.

Margin trading is a fast exit from trading if the trader has no idea what he is doing with increased loss in 100x leverage. Sooner or late the loss will be bigger that can wash the profits of the last few months but pro traders use stop-loss orders to prevent this. Slippage issues are still the biggest concern of the expert traders because stop loss doesn't always mean the trades will be cut on a specific limit. Using specific software and adding a new money management algos will not save the trader if there is no background, many traders prefer to buy from the lucrative trading "millionaires". These guys will lose sooner or later due to the lack of deep market experience.

This cannot be a confusion for a beginner in trading. Misguiding :o. If a trader is good in knowledge then they will go for analyzing what are the pros and cons of going for margin trading. Only after gaining knowledge about all risks involved in margin trading, they might get confusion about choosing one out of these two type of tradings.

No traders should be given these two type of trading options in their beginning days itself. Every trader must start with spot trading and must gain sufficient experience in spot trading and only after finding comfortable with spot trading, they may think about getting into margin trading given that they are having good backup capital.

Without any second thought the best and the most popular vote has to go to spot trading. It's the safest for anyone wanting to adventure into the world of cryptocurrencies trading and the features are quite easy to understand irrespective of you not having any prior knowledge of trading.

Spot simply has to do with the buying and selling of coins without any additional leverages in the simplest way possible which is perfect and serves as an advantage since you can easily turn into an investor by holding unto your coins if you made the wrong call but with margin trading, you get liquated the moment the market is moving against your call and you're in lost to a specific amount you won't be able to cover with your funds.

Margin trading should only be engaged by advance and experience traders as it has high risk written all over it. It isn't that simple too and can't be easily learnt without having some knowledgeable idea on what you intend doing.

You are pretty much correct. Hence why when it comes to spot, margin, futures or options trading the best strategy is basically spot because it gives the least amount of chance to blow up your entire accounts. Look at how many people got liquidated in the last 12 hours who went long on bitcoin futures? Basically price went down $1000 in about 6 hours and anyone with a >10x leverage most likely got liqudiated and lost their entire accounts.

Hence why there are warnings after warnings when you try and open a futures again. They make you read so many terms and conditions because they want to protect themselves against being sued when you end up blowing an account and blame it on the exchange for your losses. So with a regular 1x leverage spot account you are less likely to get liquidated.

I think the term "best" is subjective because we traders have different characteristics and skills and we cannot say that spot is better than margin or vice versa. I'm a spot and a margin trader when it comes to high reward, margin is good because I can borrowed funds there or what they called leverage but the thing is I do not use leverage more than 50x because for me it is risky and I can lose my capital easily with one wrong move. In spot trading it is good because I have more good risk management there, the only downside is we should not expect to huge gain in small period of time unlike in margin where in you can gain more than 100% in just minutes but still the risks are so high so you can also lose huge without proper knowledge in trading.

I’m not newbie anymore but I still prefer spot trading because of lesser risk and I control the money that I have, which I don’t need to borrow funds and take more risk. Margin trading is risky and can lose your money easily if you input the wrong key, so this is not advisable to newbies at all. Take a little step before taking too much risk, sometimes small steps are enough to achieve your goal.

Margin trading has one very important advantage over spot trading - it is to stay in the trade when the price falls. There are still many advantages of margin trading, but there is also one very big drawback - the possibility of losing your deposit if you trade incorrectly.

What is interesting about the whole deal is that margin trading is for the most part promoted to newbies, and this is because exchanges know that most newbies will no take the time to make any research and as soon as they learn of the huge profits they can make they will be immediately attracted to it and will try their luck with it even when they do not have the abilities to survive for long, in a way I cannot blame exchanges since they are just trying to make money like any business but newbies need to learn that it is simply impossible for them to make those kind of profits on the markets and simply accept it instead of taking dumb risks that will eventually cost them all their capital.

In my experience, newbies should master margin trading before switching to spot trading.
Although margin trading is a very difficult subject and there are more than 90% of traders lose money in the first few years, it will help new traders practice many of the virtues needed to trade well.
Margin trading requires very high TA knowledge, besides having good discipline and emotional management, ... that will create a real trader. After being good at margin trading, you will make more money with spot trading. For me this is the best strategy to turn a bad trader into a professional trader.

I don't just think, but I highly recommend that traders who don't have at least a few months of active trading in the markets do not use leverage trading aka margin trading.  It can be a career destroyer if you use it early, trust me. Or... at least you should document yourself and make minimum 100-200 trades on a demo account. There is no best strategy, it's about the risk you want to take and what kind of instruments you're trading.

If you are trading forex and especially on lower timeframes you have to use leverage to optimize your account, but keep it at a very low amount. Remember that even professional traders almost never go past 3-4x leverage.

There is no doubt that spot trading is a better trading method, it is not even close to each other that we should compare the two of them.

Margin trading is something veterans of trading world does to make the most amount of money with the minimum input, hence why there are a lot of newbies who do not want to start out with big money that wants to make a lot of money that takes an interest towards it wrongfully and lose a lot of money in the end, or there are poor people who can't afford to make a decent return with spot trading because they are not putting up big capitals who get into margin trading in order to make something decent with the low amount they have but end up losing it all. Instead of these, just do spot trading and earn less but also not lose a lot, that is much better method.

Actually, it took me months before I decided to try spot trading. At first I really have hard time understanding the leverage system and it is actually funny because I watched a lot of videos in youtube just for me to understand it and I also spend a lot of time in reading different articles about it. But luckily I managed to understand it and I keep using it now, I do not suggest the margin trading especially for newbies because for sure they will easily burn their portfolios. The potential rewards are high but also the risks are high so the capital should be low or a money that you can afford to lose. I use VAR whenever I will enter in margin trading because value at risk can help me to identify on how much bitcoin that I will allocate in that certain trade.

Choose what's best for you since we all have different trading strategy so its possible that Margin trading is good for me but you see this one as not as good compare to spot trading. Traders must build your own ways of trading, don't listen to the noise of the public, stay focus and know what strategy to be used. I do spot trading always, and I tried Margin trading once but I can't handle the risk of it so I decided to stopped it.

Choose the strategy that we think suited to us and being comfortable with.

That's right. A recommendation is just like that but at the end of the day, we have to make our decision that we think seems to be fair. Why not try them both and to know which one feels better and profitable? Of course, not all of them will work. This is not a challenge but would like everyone to experience and to finally have their own decision prior to the trading carrier.  

Make sense, what's makes you feel you comfortable with is the best one to proceed.
It's takes time learning both venues of trading strategies choose which one is best for you.

Traders always go for profits, taking risk is part of your everyday life around trading market picking up what's style
and what's  converting good benefits consumes time.

Having such options and see which is better will give you a much better chances to succeed from your trading engagements.

I prefer spot trading to margin or futures trading. My mentality is not completely strong if you have to participate in margin or future trading because the risk is much greater than spot trading. In spot trading, at least our capital will not be liquid or scorched compared to margin or future if the predictions we use are wrong, especially I am a typical trader who is anti-cut loss when coins drop to low prices, I am optimistic that later if the bitcoin price rises it will have an impact on altcoins what I hold will also go up to a high price. It's different if you prefer futures or margins, if the prediction is wrong, our capital will run out and there will be no remaining at all, this is what causes me to be somewhat less interested in futures or margins.

The main reason why people do not go with margin trading is the fact that it is not something you can learn in a day, it is not as simple as "buy low, sell high" because it is fast paced and it also requires a lot of your time as well, you can't just buy a long and leave your computer, or even if you have to at least you have to do it when you arrange everything to be handled with stop loss and cash out and basically all kinds of orders. Spot is not like that, you go and buy some and go live your days like nothing happens and you could still profit from it.

So, when you combine the risk involved, the time consuming part, the expertise and other aspects it becomes like margin trading is for niche part of trading and only applies to few people and not the general public.

Spot trading is the method of purchasing or selling digital assets done in a limited timeframe, where delivery of your exchanged crypto will be done instantly.

Pros: Spot trading provides great risk management with its security system. https://www.koinbazar.com/  (https://www.koinbazar.com/)can help reap the benefits of the system. Additionally, only the balance you possess in your account will be lost.

Cons: With the concrete balance and risk management, not many opportunities can be begotten.

Margin Trading allows you to trade only a portion of your account balance to ordain the leverage of the position you are trying to enter. You can withdraw under your trade.

Pros: Margin trading comes to much avail to the trader when he intends to gain more profit. Exchanging with crypto, the user may trade as much as his investment allows them, and at a time, most suitable for them to receive a return on investment.

Cons: In Margin Trading, you can lose more than what you invested initially and chances are, all of your capital as well if you traded 100% of capital.

Bottomline
Margin and Spot Trading come with their drawbacks and prerequisites, so it’s up to the trader which prerequisites are more beneficial to his circumstances and which drawbacks are more negligible or negotiable. Along with enough knowledge and risk tolerance, he should make his judgment.

In my opinion, The answer to the question  is pretty straightforward and it depends on the trader's knowledge and experience level.

For novice and beginners - Spot trading is the best option.
For seasoned traders - Margin trading

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All forms of trading has risks. None of them are exempted from this. However, some happens to have more risks than others. For instance, in a regular spot thread, a 10% move in either direction is what it is - 10% increase/decrease depending on the direction of the movement. While for a margin trade, that 10% move is dependent on the margin level, say 3x for example. That would mean 3 x 10% equalling 30%.

That said, it is recommended to first get a taste of trading via spot trading and slowly move to margin with very low leverages and then move up the ladder as experience builds up.

Both trading style could result to profit or loss and it all depends on how enlightening and lucky the trader is. Margin trading though is more profitable and can also be more dangerous in regards to losing. I think we're misinterpreting the question here. It isn't about preferability but the best.

There are many risk factors associated with margin trading that it won't be fair recommending it to the community as the best ahead of a less riskier option like spot trading that only put small percentage of your capital at risk especially if you have the stop loss option set up.

Speaking about how easy it'll be for both trading technique to be useful by a noob, the vote also has to go to spot trading since it's very straight forward.

I know such successful traders who only use spot trading. This is how they explain their successful trading that they do not use margin. However, trading on the spot market is comfortable if you have a large deposit that allows you not to use borrowed funds from the exchange. If you don't have such a deposit, you can't do without margin.

Actually none is the best strategy. One should do which is suitable to one however trading spot is usually advised for traders who are just starting out. It is advisable to trade spot until one have understood how the crypto market works especially with fundamental and technical analysis before one venture into margin trading.
Margin trading gives the benefit of trading with borrowed funds from the exchange and it multiplies both the profits and the losses.

Margin trading is only for professional traders who already have good trading skills. While spot trading is great for newbies,
because the risk is not as big as margin trading. It is true that margin trading is much more profitable than spot trading,
but not everyone can make profit from margin trading. I have had bad experiences with margin trading, so I recommend
avoiding margin trading, it's better to use spot trading a much safer.

There is misunderstanding because a experienced trader can also choose margin trading as long as they have proper risk management. If you are a beginner, I will not suggest that you should first make a trade using margin because for sure you will lose it real quick; it is better to make practice and become used in spot trading first. Margin is about borrowing funds and it is not about easy money in trading. A lot of traders think that they can make money easily in margin where it is a myth because the risks are much higher than doing spot trading because you are borrowing the exchange funds. Do not switch into margin if you are still not experienced trader in spot trading.

If you are going into crypto with under 50 dollars and you want to make sure that you make the most money out of that 50 dollars and using regular spot trading with just 50 dollars will usually not yield you anything proper. So, what you do? You either go with margin trading to make more money with high leverages and risk it all being liquidated if you are wrong, or you could just focus on lower level altcoins that could make you 2x or more.

Even spot trading ethereum this year could have turned 50 dollars into 200 dollars which is not really a big amount in dollars but a great return. However if you have a lot of money, you should stick with spot trading, that would always be a great return if you have a big enough capital to work with and you can be happy with the returns.

That's some wrong thinking right there, you can lose your capital in the spot market when you don't know what you're doing especially when there's a flash crash and you stop loss entry was missed or you didn't have that set up in the first place. During the DeFi crash we saw altcoins losing close to 90% and even more of their value that means any investment capital most have gone down minus 90%.

A trading account with capital that was worth $1000 will be having just $100 to left. While that of margins trade would had probably cleared the account still having just 10% of your investment capital isn't something we should settle for as it isn't better than losing it all in this case, they both are loses.

Nothing can be said to be the best from both strategy, both still require expertise, the best strategy in my experience in trading is when setting up stop lost.

And this is what happens to a trader who buys coins at a price hundreds of satoshis but now the coin price is only about 5-10 satoshis, from a hundred dollars now only a few dollars left in less than 1 month.

I have tried both, spot trading and margin trading are risky. But if we compare the risks, of course, the margin trading is greater the risk.
Depending on our trading skills, if we already have good trading skills, there is nothing wrong with trying margin trading. Because margin
trading can generate profits that are much greater than spot trading.

To me, newbie should just Spot trading instead of Margin trading. In Spot trading we simply look at the signals, then buy and place a stop loss, wait for the price to rise and then sell at the desired profit.
As for Margin trading, traders must understand the value of the leverage levels in order not to trade with too large a volume. In addition, we also have to calculate volume, determine support / resistance points, under pressure when prices rise and fall nonstop, ... there will be a lot of difficulties for newbies. Newbie's ability to lose money in Margin Trading is over 93% because no one can withstand the pressure when trading.

Spot trading still the best option because we can stay with our money although have lower price from coin trading, but when back again to higher price we have chance to get back profit. For margin trading I think have the same work with future trading where wrong prediction your assets or trading salary is gone. Maybe for expert is good to trade with margin but for beginner and low budget for trading better to choose as spot trading with always have chance although coin dump will back again to higher price later, just patient with how long your coin trading back to higher price again.

Spot and margin trading are just the same thing with capital from different sources, so the risk associated with both kind of trading are similar.Margin trading is risky because we are taking funds from somewhere so we are obliged to pay the money back so extra pressure will be added while doing it which I never recommend for anyone to do.

my opinion is , if you are not an expert trader you should stick with the sport trading , low profit but also you wont risk with your money

but if you are bored of spot trading you can try margin but just take it on your mind that the risk in margin trading is very high and you can lose your money within  seconds of your journey .

Spot trading isn't really that risk-free but rather it would be much lesser risky to margin because if we do talk about between margin and spot then you can spot out
the risk that been given or you do deal with it.

If you don't have that kind experience and knowledge towards trading in a long time then better not to rush up with margins but if you
do saw that you are already capable enough then you can test it out.

Just stick out on which one would really be profitable for you but same as suggested that as a beginner then its ideal to start with spot.

It's almost the same risk with future trading same risk to lose all your money in worng prediction. Yes if you are novice in trading you should start to learn it first in spot trading once you learn spot trading you can now move to margin if you know you can now trust your own prediction. While you are learning in spot trading you can also collect some ideas that you can ask for other traders that you think can help you in the future.

It has not been long I started trading but from the little experience am having I believe in spot trading, margin trade is for expert and not for newbies!!! The risk of margin trade is too high, but the profit is also high but am not interested in margin trading so am into spot trading and am making my cool profits there!!!

thats what you heard from the others but you have not tried it on your own for you to say that margin trading was really hard ?
 you should try it if you havent because you will never know if you can also adopt it .
 more risk is more profit, thats true and works in everything not just in trading  .
i love to face greater risk on all the thing that i do because im always after for the reward but at the same time it also crafts or build you as a better person .

As I also have been doing so far, as a beginner trader, spot market trading is the best choice for beginners. This is low risks but also probably a long time to get profits or lower profits in a short time. However, if the price continues dropping after buying, in this case, we will not lose our money as long as we still keep the coins and not panic sell. However, think about the cut loss may be wise enough in order to know the market condition whether will be dump more and more or only market correction and rising again.

However, if you have been ready with such quite higher risks, I think that the margin market is good and suitable. We can double our funds and also profits with this. but of course, the level of the risks are higher.
So this is it, just think what you think that this is good for each.

Spot trading allows to buy and sell cryptos at the present market value. In Margin trading, one can borrow funds from the exchange and can use them for trading. Each has its pros and cons.

You can read a blog on types of trading at https://koinpark.com/blog/comprehensive-guide-on-types-of-trading