Different trading methods
Futures speculative trading is to establish a single futures contract with long and short checks in a period of time, that is, to expect more price increases and short checks when prices fall, and to trade in one direction at the same time. Hedging transaction is to establish long and short positions between related futures contracts or between futures and spot at the same time, which is also a two-way transaction.
Different sources of profit
Futures speculation benefits from the price change of a single futures contract, and hedging benefits from the relative price difference between related futures contracts and futures and spot. Futures speculators are concerned about the price rise of a single futures contract, while hedgers are not concerned about the absolute price of futures contracts, but about the price difference between related contracts and futures and spot.
Take different risks.
Futures speculation bears the risk of price change of a single futures contract, and hedging bears the risk of price difference change. Because the prices of related futures contracts change in the same direction (in futures hedging, futures prices and spot prices also change in the same direction), the price difference is generally smaller than that of a single futures contract, that is, hedging transactions bear less risks than speculative transactions.
Different transaction costs
Hedgers take less risks in trading, while speculators take more risks in trading. Therefore, in order to encourage hedging transactions, international futures exchanges usually charge lower margin for hedging transactions and higher margin for speculative transactions.