In futures trading, any trader must pay a small amount of funds according to a certain proportion of the value of the futures contract (usually 5%- 15%) as the financial guarantee for his performance of the futures contract, and then he can participate in the futures contract trading and decide whether to add funds according to the price change. This system is the deposit system, and the money paid is the deposit.
Trading margin refers to the actual deposit paid by member units or customers for holding futures contracts in futures trading. It is divided into initial margin and additional margin:
1. Account opening deposit
Initial margin is the money that traders need to pay when they open new positions. According to the transaction amount and margin ratio, that is, initial margin = transaction amount and margin ratio. At present, the minimum margin ratio in China is 5% of the transaction amount, which is generally between 3% and 8% internationally.
2. Additional deposit
When the book balance of the margin is lower than the maintenance margin, the trader must replenish the margin within the specified time, so that the balance of the margin account is ≥ settlement price x position x margin ratio, otherwise the exchange or institution has the right to forcibly close the position on the next trading day.