The leveraged position explosion refers to the forced liquidation of investor accounts by securities companies when losses from stock margin trading are greater than the account margin. When there are no funds in the account, half of the margin loss will be forcibly liquidated. An explosion in equity leverage could require investors to lose money. If most of the funds in the margin account are occupied by trading margin, and the trading direction is opposite to the market trend, and the margin loss drops below the closing line, it is easy for investors to break through.
When the market situation undergoes major changes, if the position explosion leads to losses and it is caused by investors, investors need to make up for the losses, otherwise they will face legal claims. For market investors, high leverage carries high risks. If investors do not have enough market experience, try to avoid high-leverage trading products to prevent huge losses.
In order to avoid position explosion, market investors need to control their investment positions, manage their funds reasonably, and not conduct full position transactions. And set stop loss points according to investors' trading strategies, and try not to go against the trend or blindly follow the trend. Margin trading is a leveraged transaction, which refers to investors borrowing funds from securities companies to purchase stocks and repaying principal and interest within an agreed period; securities lending refers to investors borrowing stocks from securities companies and selling them. Within the agreed period, purchase the same number and type of stocks and return them to the securities company, paying the corresponding fees.
Global Fund only participates in crude oil trading and does not participate in the trading of other related commodities. The difference between the size of commodity positions and the size of the monetary environment is sufficiently large that there is no over-speculation. There are huge differences between different sectors. The profits of the entire industry chain are relatively high now, and there may be great fluctuations in the future. There will be huge risks in both directions. In the commodity futures market, traders do not need to pay the entire contract value, which makes futures trading characterized by high returns and high risks. If leverage is used improperly, it can cause huge losses.