Futures have daily settlement system and strong leveling system. When the available funds in the account are negative, the futures company has the right to close the position and strengthen it, and ordinary investors will not be short. Even if there are short positions in extreme markets, there is no clear standard for the specific amount of remaining funds after short positions.

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Forced liquidation is also called forced liquidation, which is also called being cut, cut and exploded. It refers to the situation that the customer's rights and interests in the investor's margin account are negative under some special circumstances. 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.

According to the different reasons of forced liquidation, forced liquidation can be divided into the following categories:

1. Forced liquidation due to failure to fulfill the obligation of additional margin. According to the rules of the Exchange, a margin system is implemented for futures trading, and a certain percentage of margin must be paid for each transaction. When the market changes unfavorably, that is, when the market reverses and changes in the opposite direction, members or customers should also add margin according to the trading rules and the contract when entering the delivery month. 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.

The Administrative Measures for Risk Control of China Financial Futures Exchange stipulates that compulsory liquidation will occur in the following five situations:

(1) The balance of member settlement reserve fund is less than zero, and it has not been replenished within the prescribed time limit;

(2) The position exceeds the position limit standard and fails to close the position within the prescribed time limit;

(3) Being punished by CICC for compulsory liquidation due to violation of regulations;

(4) According to the emergency measures of CICC, the liquidation should be forced;

(5) Other positions should be closed by force.