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INTRODUCTION

Greeting to all my esteemed steemians.It a privilege to write after a serious well understood class by professor @besticofinder

TOPIC III COVERED: HOW TO SPOT TRADE?

HOMEWORK TASK: EXPLAIN SPOT TRADING AND MARGIN TRADING, ADVANTAGE AND DISADVANTAGE OF SPOT TRADING AND MARGIN TRADING

WHAT IS SPOT TRADE

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In a spot trade securities, foreign currencies and goods are one of the exchanges done. This is a cash trade that takes place in a spot market which also is determined by the instant cash exchange of goods.if someone purchases a good for a specific amount, it's advisable to deliver the goods on time cause of the rate is was sold. It also can be said to be when a financial instrument or foreign currencies are either bought or sold in exchange of a product and delivered to a unique spot date and this is known to be a spot transaction. Cash exchange simply means "delivery". Did I forget to mention that spot markets are also known as liquid markets.

ADVANTAGE OF SPOT TRADING.

*1. Both from the buyer and the seller can avail the advantages.
*2. A very large number of buyers start the price war which then they begin to offer the best price to both the buyers and sellers because of the negotiation between both parties is highly competitive.
*3. One should not be afraid because illegal transactions can be avoided. it is an accurate system which is transparent and regulated of such fear of fraud.
*4. Buyers should expect high quality because the items are handled and stored in good condition.
*5. There is open arbitrage prospect.
*6. Transactions are enabled faster because of technological advancement.

DISADVANTAGE OF SPOT TRADING.

*1. Sometimes you will be stuck to one supplier which any disputes can turn scatter or terminate your deal.
*2. You can't make an advantage of a drop in spot premiums.
*3. If you aren't sure of the vessel on time, your supplier may have the right to charge you a high spot price instead of the agreement, so you have to be sure of your commodity on time.
*4. Price fluctuation of some commodities or the amount of commodities buyers buy on the spot can increase prices before the asset will return to it's normal price.

WHAT IS MARGIN TRADING.

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The difference between the total value of an investment and the loan amount can be said to be when a person goes for a loan from a broker to purchase an investment which margin trading refers to the practice of using borrowed funds from a broker to trade a financial asset, which forms the collateral for the loan from the broker. Buying and selling of securities or stocks to make more money is called margin trade.

ADVANTAGE OF MARGIN TRADING.

*1. You the chance to leverage on assets.
*2. You have the opportunity to make gain from share price declines.
*3. You can expand a concentrated portfolio.
*4. You've a suitable line of credit.
*5. You get very low interest rates.
*6. You've a room for repayment flexibility.
*7. You've an opportunity for a deductible tax interest.

DISADVANTAGE OF MARGIN TRADING

*1. You could lose more money compared to the one your intial deposit in the margin account.
*2. The platform can persuade the sales of securities in your account.
*3. Your securities can be sold by the firm without them contracting you.
*4. You are not given a time addition on a margin call.
*5. Short-sale positions could cost you when they're open.

CONCLUSION.

Well this is really a strong knowledge I wish everyone should have in the crypto world.
Thank you for this knowledge and giving me this assignment to share my knowledge and stand to be corrected as well.
Big thanks and hope I did good @besticofinder ❤️ and thanks to my mentors @talktofaith @focusnow @ngoenyi

Cc:
@steemitblog
@steemcurator01
@steemcurator02
@besticofinder