How are you all? Today I will discuss with you How are spot trades settled !  I am young and have very little experience so please excuse any mistakes.

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[Source](https://pixabay.com/illustrations/trading-investing-stocks-options-7181178/)
How are spot trades settled?
Foreign exchange spot contracts are the most popular spot trades.  They are usually delivered in two business days (T+2), with settlement of several financial instruments occurring on the next business day.  With more than $5 million traded daily, the forex market is the largest in the world.  It is also known as "Spot Foreign Exchange Market".  Interest rates and commodity markets are relatively small.
The spot price of a financial instrument is the price at which you can buy or sell it.  It is created after traders place their buy and sell orders.  New orders entered into the market are filled immediately.  Hence, spot prices always fluctuate in liquid markets.  Other interest rate instruments such as bonds and options are also traded on the next day.  Interest rate swaps often have a short-term leg for spot dates.

[Source](https://pixabay.com/illustrations/bitcoin-coin-money-electronic-money-495994/)
Examples of Spot Market Trading
Let us now look at an example to understand how spot transactions are settled.  Let's say a trader wants to buy gold.  Their first step is to find a physical or online dealer that sells gold bars, coins or ingots.  He can search for top online bullion dealers.  All the trader has to do is pay the dealer the current spot market price of the bullion.  The dealer will then take physical delivery of the gold.  This will mark the end of this transaction.
Today's discussion ends here.  I hope you find it interesting and able to understand.  Share your thoughts on today's topic.  Wishes and blessings to all.  Everyone stay well stay healthy stay with Steemit.