For several investors, entrepreneurs, and businesses future trade serves as a hope to procure their assets. With the Binance clone script, we can customize it according to the requirements.
Future trading is buying or selling your assets for a predetermined price as a contract on a specified date in the future. The major trait that future trade carries is leverage. One can perform future trade with leverage and also without leverage. Let's know the purpose of future trade.
Why do we need future trade?
Future trade is worthy enough because of its two important features other than leverage. One is hedging and another is speculation.
Hedging is a simple method of protecting our trading positions without losses against price fluctuations. It is like making a contract for the future by locking the current price of an asset to buy even though the price of a particular asset increases. Many businessmen and investors utilize hedging to buy shares or assets. Where speculation is guessing market trends and buying or selling the assets.
Let's decode it with a real-time example. Following the Russia-Ukraine war, the price of crude oil has increased. Analyzing the geopolitics, traders or investors anticipate and buy them at the initial stage of the war. Crude oil is crucial for military supply. And at that time of demand, the price of the crude oil goes up and traders sell it and make huge amounts of profit.
Now, we can get to know how Future trade works and what options it provides to benefit the traders.
How does Future Trade Work?
Future trade provides two contracts - Coin-M contract and USD-M contract. In the Coin-M contract, users can only buy or sell coins like BTC, BNB, and LTC. In a USD-M contract, users can buy or sell only the tokens specifically USDT alone.
If we take the Coin-M contract, for instance, the current price of the BTC is 69, 000 USD. You're placing a contract by expecting that the price of the BTC will rise.
When you place the contract, after a week, the price of the BTC rises to 72,000 USD. Now, if you decide to close the position, you'll have 3,000 USD as profit in your wallet.
Future trade has two methods of contracts which are designed for the user's convenience.
They are Perpetual and delivery contracts. Perpetual doesn't have an expiry date. You can close the position when you want to close, till then you can watch when the price increases or decreases and act upon the situation of the market.
Delivery contracts do have an expiry date. Here, you trade for a predetermined price on a specific date. When the specific period comes, the position closes and will conclude at the market price at that time. The contract might bring you a profit or a loss.
It has a margin option, where you can borrow and place a contract based on immediate occurrences.
By implementing Future Trade in Binance Clone script, you can acquire the assets by making a contract by analyzing and guessing the foreseeable trends in the present. You can reap huge profits by securing the assets.
