Spot Trading vs Margin Trading - Which is the best Strategy?

[JamesIrvin]

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.

To Know More, Visit Here <> Spot Trading vs Margin Trading

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[tsaroz]

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.

[Kelvinid]

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
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.

[Silberman]

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.

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.

[GeorgeJohn]

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.

To Know More, Visit Here <> Spot Trading vs Margin Trading

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.

[Fundamentals Of]

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.

[wack slacker]

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.

[milewilda]

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.

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.

[GreatArkansas]

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.

[Shadikjitu11]

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.

[DevilSlayer]

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.

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.

[tranthidung]

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.

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)!
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!

[Salauddin1994]

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.

[Peanutswar]

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.

[Fundamentals Of]

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!

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.

[avikz]

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.

To Know More, Visit Here <> Spot Trading vs Margin Trading

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!

[XZERO1]

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.

[palle11]

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.

[Viscore]

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.

[StephenJH]

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.