A short position means that the loss is greater than the margin in your account. After the company is forced to draw a tie, the remaining funds are the total funds MINUS your losses, and generally there will be a part left. Commonly used in spot gold and futures trading.
Extended data:
Explosion type:
1, forced liquidation due to failure to fulfill the obligation of additional margin. According to the rules of the Exchange, the futures trading is subject to the margin system, and each transaction must pay a certain percentage of the margin. When the market changes unfavorably, that is, when the market changes reversely, and the delivery month enters, members or customers should also add margin according to the trading rules and the contract.
If the member or customer fails to fulfill the obligation of additional margin within the specified time, the trading ownership will forcibly close the position held by the member or brokerage company.
2. Forced liquidation due to violation of regulations. If a member or customer violates the trading rules of the exchange, the trading ownership will be forced to close the position and violate the trading rules. It mainly includes: exceeding positions in violation of position restrictions; Failing to report or making a false report in violation of the large household reporting system; Carry out futures business for those who are prohibited from entering the market; Brokerage companies engage in self-operated business; Manipulate the market together; And other violations that require compulsory liquidation.
3. Forced liquidation due to temporary changes in policies or trading rules. This often happens in previous years, and trading rules are often modified because of the temporary regulations of policies or regulatory authorities, or can not be implemented normally for the time being.