First, the risk of using leverage.
The capital amplification function magnifies both income and risk. Therefore, how to use the lever of 10 times and how much to use it will also vary from person to person. Investors with a higher level can use more than five times or even enough leverage. If low-level investors also use high leverage, it will undoubtedly make the risk out of control.
Second, the risk of forced liquidation and explosion.
Exchanges and futures brokerage companies have to settle accounts every trading day. When the investor's margin is insufficient and below the specified proportion, the futures company will forcibly close the position. Sometimes, if the market is extreme, there will even be short positions, that is, all the funds in the account are lost, and even the futures company needs to pay the part whose losses exceed the account margin.
Third, delivery risk.
Ordinary investors do not want to buy more soybeans in a few months, nor do they want to sell copper in a few months. If the contract is held until the delivery date, investors need to collect enough funds or goods for delivery (the payment is about 10 times of the deposit).
Four. Risks of Brokerage Companies and Intermediaries
The irregular operation of the selected futures company or intermediary may also bring losses.
Verb (abbreviation of verb) principal-agent risk
Investors who hand over their accounts to professional traders have to bear the risk of entrusting agents.
The above is about the risk sharing of futures investment. I hope to help friends who want to know about financial management. For more related content, you are welcome to pay attention to this platform in time!