What is Future? A comprehensive guide for new investors

Are you looking for a way to explore the world of futures trading (Future) but don’t know where to start? This article will provide you with knowledge from basic to advanced levels on how to trade Futures, helping you confidently step into this dynamic cryptocurrency market.

Understanding Futures in Cryptocurrency Trading

Futures are trading instruments that allow you to predict price fluctuations of a cryptocurrency at a future date without owning it. This is a high-leverage trading method, creating opportunities to earn significant profits from both bullish (long) and bearish (short) markets.

Real-world example: You predict that the price of BNB will increase within the next week, so you place a 1-week Futures contract. If your prediction is correct and the BNB price rises when the contract ends, you will profit from the difference. Conversely, if the price drops, you will incur a corresponding loss.

Preparation Steps Before Trading Futures

To start trading Futures, you need to complete some basic preparatory steps:

Create and verify your account

• Register an account on your trading platform
• Verify your identity by providing ID documents (passport, ID card)
• Set a strong password and enable two-factor authentication to protect your account

Activate Futures feature Access the “Futures” or “Contract” section on the platform and follow the instructions to enable this feature.

Deposit funds into your account

• Choose the cryptocurrency you want to deposit
• Copy the wallet address or scan the provided QR code
• Transfer funds from your personal wallet or another platform
• Wait for confirmation and for the funds to be credited to your account

How to Place a Futures Trading Order

Select the contract and trading pair Access the Futures trading interface, choose the contract type (BTCUSD, ETHUSD, etc.) and the trading pair you want.

Choose the appropriate order type Most platforms offer the following order types:

• Market Order (Market Order): Execute immediately at the current price
• Limit Order (Limit Order): Execute only when the price reaches your specified level
• Stop-Loss Order (Stop-Loss Order): Automatically buy/sell when the price drops to a preset threshold
• Take-Profit Order (Take-Profit Order): Automatically buy/sell when the price reaches your target

Enter trading parameters Specify the amount of cryptocurrency you want to trade and your expected price, then confirm the order.

Manage your position After the order is executed, you can monitor and adjust it through the trading dashboard.

Risk Management - A Key Factor for Success

Determine acceptable risk thresholds Before starting, set the maximum loss percentage you are willing to accept (5%, 10%, etc.). This helps you cut losses promptly when the market moves against your expectations.

Always use stop-loss orders This is the most important protective tool. A stop-loss order automatically triggers a sell or buy when the price drops to a predetermined level, helping to limit losses.

Diversify your investments Avoid putting all your funds into a single cryptocurrency or a single order. Allocate your capital across multiple assets to spread risk.

Understand profit and risk mechanisms Learn thoroughly how to calculate profits, losses, and the impact of leverage before placing orders.

Effective Futures Trading Strategies

Conduct thorough research before each decision Spend time analyzing the market using technical tools, reading price charts, and understanding the trends of the cryptocurrencies you are interested in.

Follow your trading plan Develop a clear plan with specific goals, entry, and exit points, and stick to it disciplinedly. This helps you avoid impulsive decisions driven by emotions.

Focus on high-probability opportunities Select trading opportunities rather than participating in every order. Concentrate on trades with clear technical signals and high success probability.

Learn from experience Keep records of each trade, analyze what was done right and wrong, and continuously improve your skills.

Important Trading Fees and Withdrawal Information

Cryptocurrency trading platforms have different fee structures. Futures trading fees are usually lower than spot trading:

• Spot trading fees (Maker/Taker): around 0.1%
• USDT-M Futures contract fees: 0.02% – 0.04%
• COIN-M Futures contract fees: 0.015% – 0.04%

Note on withdrawals Before withdrawing funds, carefully check the applicable conditions. The platform may require re-verification to ensure security.

You have various withdrawal methods such as bank transfer, e-wallet, or other payment channels. Calculate the withdrawal fees carefully to determine the actual costs.

Before confirming the withdrawal, double-check the recipient account information and withdrawal amount to avoid errors.

Conclusion

Futures trading is a powerful tool but also involves high risks. Success requires in-depth knowledge, a detailed plan, and strict discipline in risk management.

Start by understanding basic principles, practice on a demo account if available, and always stay updated with market information. Remember, no trading strategy is 100% correct – perseverance and continuous learning from mistakes are the keys to long-term success in the cryptocurrency market.

Disclaimer: This content is for educational and informational purposes only, not investment advice. Conduct thorough research and consult with a financial professional before making any investment decisions.