I believe many people know about virtual currency, but how many people have really touched it? How does virtual currency operate in stocks? The following is for you from Bian Xiao. Does the virtual currency leverage explosion need compensation? I hope you like it.
Does the virtual currency leverage explosion need compensation?
There are risks in leveraged trading of virtual currency. If there is a short position, you may have to bear the corresponding losses. Virtual currency is a digital asset, which is traded and stored on the basis of encryption technology. They do not belong to any specific country or institution, and exchange on the Internet. The most famous representative of virtual currency is Bitcoin, but there are many other kinds of virtual currencies, such as Ethereum and Litecoin. Virtual currency has the characteristics of anonymity, decentralization, rapidity and convenience, which has attracted extensive attention and investment. However, the virtual currency market is very volatile, and price changes may cause investors to suffer losses. Before investing in virtual currency, it is recommended that you fully understand the relevant knowledge and carefully evaluate the risks. Please note that investment is risky and you need to be cautious when entering the market.
What does bitcoin explosion mean?
First of all, what is the Bitcoin Big Bang? It refers to the behavior that investors are forced to close their positions when their assets can't meet the margin requirements of leveraged trading when the price of bitcoin drops sharply. In other words, if you buy Bitcoin through leveraged trading, it suddenly drops so much that your account is no longer enough to meet the margin requirements of leveraged trading, then the position will be forced to close. At this time, it is equivalent to automatically selling bitcoin after you buy it at a certain price, resulting in asset losses.
The price of bitcoin market fluctuates, and leveraged trading is equivalent to borrowing, which means relatively greater risks. If the market price falls fast enough, you may have to pay other fees besides leveraged margin. In this case, your assets may be forced to sell, and if the price is lower than your original investment cost, you will face huge losses. Even without leveraged trading, market price fluctuations may make investors face losses.
What can be done to prevent the warehouse from exploding?
Formal joint-stock companies have their own risk control system. Although the company does not participate in the user's account operation process, the company's risk control system will supervise the user's account and record the user's capital movements and profit and loss status. Especially when the stock market falls sharply, the company can prompt users in time to prevent them from touching the warning line or liquidation line.
The company will make an appointment with the user about the position ratio of a single stock, and users are not allowed to make a single Man Cang. You should know that users are responsible for their own profits or losses, so users should pay more attention to their account management. Sometimes you may want to hold the whole stock when you find that the stock is in a good trend, but this is risky and vulnerable to market shocks. Users try to avoid this operation for the safety of their own funds.
The management of capital account is the knowledge that users need to learn all the time. Only by mastering this technology can users prevent the explosion of warehouses.
Will Man Cang stock explode?
Short position refers to the situation that the customer's rights and interests in the investor's margin account are negative under some special circumstances. In the A-share market, investors will not explode their positions in ordinary transactions. Even if the stock price falls and investors suffer huge losses, as long as investors do not take the initiative to sell stocks, they will continue to hold stocks. Of course, if investors buy stocks and their companies go bankrupt, investors will apply for compensation, and listed companies will make corresponding compensation according to the stocks they hold.
Investors carry out margin trading, that is, borrow money from securities companies and buy a stock. Considering the risk, the securities company will agree with investors on the liquidation line, that is, when the stock price falls and the loss reaches the liquidation line, the securities company will remind investors to add margin. If investors add margin to maintain losses, there will be no short positions. If investors do not add margin, there will be short positions, that is, securities companies are forced to close their positions.
What do you mean by short position?
Generally speaking, short positions refer to short positions made by bearish investors, but the market outlook suddenly rises, resulting in huge losses. For example, investors think that a stock will fall in the future, so they sell it to a securities company, but a stock not only does not fall, but even skyrockets. For short-selling investors, not only the principal loss, but also the leverage loss of securities lending are called short positions.
For securities investors, short positions mean that losses have fallen below the liquidation line. At this time, the proportion of protection will be reduced. If the margin is not added, the brokerage firm will be forced to close the position, and the losses and handling fees caused by the forced liquidation will be borne by the investors themselves.
In the futures market, short position is also a meaning. Because futures can buy up and down, investors who buy down have made empty orders, but the market outlook has risen against the trend, resulting in huge losses.
Generally speaking, for investors who do not have margin financing and futures options, there will be no short positions, because there will be no short positions unless the stock price falls to 0 yuan.