Hi steemains, today I'm inviting you to review my homework.
I learned a lot from the post by @besticofinder on spot and margin trading, and to show that we understand his lectures.

HOME WORK TASK 3:

(1) Explain Spot Trading and Margin Trading
(2) Discuss the advantages and disadvantages of Spot Trading and Margin Trading

ANSWER TO THE HOME WORK :

WHAT IS SPOT TRADING?

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It is referred to a ground in which buyers and sellers can transact financial assets of coins at an agreed market price which is mostly immediate. It cuts across many areas like crypto, forex, and commodities. It can be likened to trade by barter that was done in that time period . It is simply like this as You give me 5pounds of onions , and you get 2 pound of rice. It is done immediately in most cases, and The transaction is sealed in this way. Now days technology has changed the order, but we can still get the good experiences. The crypto traders can sell assets using the he spot trading techniques, and agreement is made immediately without seeing one another.

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Spot trading is observed as the selling and buying of assets of coins on the spot [immediately]. Sometimes, it would not be on spot I.e immediately, when a seller sets a price that conforms with what a buyer wants to pay, the transaction happens immediately. Ans the second way is, when the price is below, the asset will pend until the price that matches reaches before it fills. Trade in both ways in market and they are both spot trading.

I will like to give an example of spot trading using VCC Exchange.

First go to the VCC website (https://vcc.exchange/), Click [Login] from the menu of the page to log into your account Trade.

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Then click on [Exchange] -> choose [Spot Trading]

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Let's take an example to buy ETH. If you want to buy ETH using BTC, choose BTC Market and input ETH in search box. Next, you can enter corresponding spot trading page by clicking ETH/BTC pair.

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Here is the trading page interface.

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picture one is the Trading volume of trading pair in 24 hours

picture two shows Sell order book

picture three shows Buy order book

picture four Candlestick chart and Market Depth

picture five shows The Order form - Buy

picture six shows The Order form - Sell

picture seven shows Your latest completed transaction and Market Recent Activities

picture shows the Other Trading pairs.

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See the above image
First select the pair to trade, after selecting the pair I want to trade, the next step was to make a decision either buy or sell. And on VCC Exchange, the buy and sell can be located on the right side of the screen,and in the yellow box, the price, quantity, and fee play an important role. The price will be filled by the trader. If the actual price of the asset I'm buying or selling is 0.000045BTC, I can decide to increase or decrease it. Or I can go for the normal price . Afterwards any price I that set will evaluate the number of assets to be purchased or sold. So here would determine whether I will buy or sell immediately or wait for the price rates become what to filled by itself .

The above image shows, that is the spot price for the seller and the buyer . If anyone who wants to sell or buy asset chooses any of the leading prices, it would fill immediately if the price of the asset in question tally. Else, some parts will fill and the remaining will be pending till a marching price is located. Buyers and sellers create the spot price by posting their buy and sell orders which fill accordingly depending on the differences in buy and sell order on the table.

WHAT ARE THE ADVANTAGES AND DISADVANTAGES OF SPOT TRADING?

ADVANTAGES OF SPOT TRADING :

1.The traders can buy and sell immediately in the market without any hurdle.

2.Spot trading can be carried out even with a small fund at any time.

There is nothing like paying of debt.The risk is minimal.

Our Fund can be managed by self easily .

There is flexibility in spot trading and bad trade can be left to bounce back.

spot trade hasSimplicity and automation.

DISADVANTAGES OF SPOT TRADING :

Spot Trading has low premium because spot trading can be done with small capital, the profit might be meager.

MARGIN TRADING :

We can define MARGIN TRADING as the process in which trader borrowing funds to the trade. It is done differently from spot trading because traders are allowed to borrow money irrespective of their current asset, however, not too low.

The margin trading is unique, as it has many rules that makes it unique. They protect the interest of the lendee not to run into losses, that's why trader invests an extral amount to trade with.This trade has a specific percentage your fund must not get down to. The liquidate the assets, Once it is discovered that your fund has reduced to respected percentage.

WHAT IS MARGIN CALL :

When fund is the loss is regulated so that the trader or exchange that borrow money out won't lose their FUND is term as "CALLED IN " . For example, if 25% of the fund used for trading is from a trader or an exchange (e.g, $45000 from me and $45000 from them), once a certain percentage has reduced from the whole $90000 , Then one partner (trader/exchange) will take some measures . So the "call in" will enable the liquidation of asset in order to allow them to
their money back. Every shortage incured will be paid. More fund can be added to the trade once it starts hiting the "call in" stage to avoid this.

Below are some of the disadvantages of margin trading.

DISADVANTAGES OF MARGIN TRADING :

Marging trading can be have more advantages by means of a heavy profit if the market goes in favor, but if vise versa, the effect is grave that is worse situation for trader and you must pay it.

Hope you liked it.

Mentioning respected @steemcurator01, @steemcurator02, @steemitbelog and @besticofinder for their support.