If you’re serious about learning how to trade Litecoin, then there are a few things you will need to be aware of when making trades. The following are important considerations for entering the world of crypto-trading.
You will of course pay fees for brokerage services to trade Litecoin. The fees and commissions will vary between providers and are charged in different ways.
Trading commissions are a straightforward charge that is levied for every trade that you make. Some providers charge a flat rate, but most will charge a percentage of the trade. Once again, these vary quite a bit, but are typically between 0.10% and 0.25% per trade. It’s not uncommon to see platforms advertising commission-free trading, but these will draw their profits from having a wider spread.
The spread is the difference between the buy and sell price listed by a brokerage or exchange. The spread for Litecoin – and most cryptos – is expressed as a percentage. For example, if the buy price on LTC/USD is $60.00 and the sell price is $60.30 – the spread amounts to 0.5%.
The spread acts as an indirect fee, as your position will always open at a slight loss. Typically, brokers that offer commission-free trading will have much wider spreads than those that charge per trade.
Other trading fees
Aside from the costs involved in trading Litecoin, brokers may also charge additional fees. These include payment processing fees – charged for withdrawing and/or depositing funds to your brokerage account. It is also not uncommon for platforms to have an inactivity fee if you don’t make any trades for a given period. Once again, these will vary between platforms so be sure to do your research when opening an account – these additional charges should always be factored in when you trade Litecoin.