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What is the principle of futures investment hedging?
Participating in hedging can expand spot sales and procurement channels. One of the biggest problems in spot market transactions is the low contract performance rate and high credit risk. The main reason is that the two parties to the transaction sign contracts separately and dispersedly, lacking the binding force of performance, and often one party breaks the contract, which not only causes losses to the other party, but also forms a debt chain. Futures trading is centralized bidding, and the market is organized and standardized. Those who participate in futures trading must be full members of the exchange and pay a certain performance bond. In addition, the futures exchange also undertakes the responsibility of performance guarantee, thus ensuring the performance of the contract. Hedging can also be an important marketing tool.