Spot and futures: know what you are trading

Start with the product

In an unleveraged spot purchase, you exchange an existing balance for the asset itself. A futures trade creates contract exposure; opening it does not mean receiving the underlying coins. Spot can also be traded with margin, so check the actual product setting. See Kraken's spot distinction and futures overview.

Margin is not the position's full value

Margin is collateral supporting the position. Initial margin opens it; maintenance margin is the minimum needed to maintain it. Leverage compares exposure with the capital supporting it. A small price move can therefore have a much larger percentage effect on that capital. CME explains these requirements.

Illustrative example: a linear long position with $1,000 of exposure and $100 of supporting margin has 10× leverage. A 2% adverse price move produces approximately $20 of loss before fees and funding: 20% of that margin. This is arithmetic, not a liquidation-price calculation or a suggested leverage level.

If equity no longer meets maintenance requirements, the platform may forcibly close positions. The trigger can use a mark price rather than the last trade; an estimated liquidation price can change. Kraken's liquidation FAQ explains why monitoring only the chart is insufficient.

Funding and trading fees are different

Perpetual contracts commonly exchange funding between long and short positions; it may be paid or received. This is separate from execution fees. Check the contract's funding interval and calculation. Coinbase describes the mechanism.

Conventional dated futures expire and typically do not use perpetual funding. Contract names alone are insufficient: verify expiry and settlement terms in the product specifications.

A beginner's reading checklist

• Identify spot, spot margin, dated futures or perpetuals.
• Record collateral, contract size and settlement currency.
• Find maintenance requirements, liquidation rules and any funding schedule.
• List opening, closing and holding costs separately.

Compare like products on the fees page, then read maker and taker fees. This guide explains mechanics and does not recommend a product or position.