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Spot Trading
Trading the actual asset (you own the coins) — no leverage, no liquidation, no expiry.
What it is
Spot trading means you own the underlying crypto. Buy 1 BTC on spot = you have 1 BTC in your wallet. Compare to futures (a derivative contract) where you don't own BTC, just exposure. Spot is the foundation: it's how exchanges work, how wallets receive value, and how the actual supply/demand of an asset is set. Spot has no liquidation risk — even if BTC drops 90%, you still own 1 BTC. The trade-off is no leverage: your max upside is the asset's price appreciation. Beginner traders should be 100% spot until they understand risk management cold.
Example
You buy 0.5 BTC on KuCoin spot at $76,000 = $38,000 worth. BTC drops 20% to $60,800. You still hold 0.5 BTC, now worth $30,400. No liquidation. Compare to 10× leveraged: 20% drop = full liquidation, $38,000 gone.
How Indikora uses Spot Trading
Indikora's AutoTrader is spot-only by design. It never opens leveraged positions, never goes short, never faces liquidation risk.
Related terms
- Futures Contract — A derivative contract tracking an asset's price — used for leverage, shorting, and hedging.
- Leverage — Borrowed capital that multiplies position size — and proportionally multiplies both gains and losses.
Strategy guides that cover this
- Dollar Cost Averaging (DCA) in Crypto — Strategy Guide
When DCA beats lump-sum, when it doesn't, and the math behind the most overlooked retail strategy