When investors buy or sell some futures in the market (taking buying as an example, selling is the opposite). To buy a futures, the holder of the futures decline needs to close the position (sell the futures held) or make up the position. However, if you don't have the money to cover the position and don't want to close the position, there is another way to lock the position. The way to lock the position is to sell the same amount of futures and let the futures fall again. Because you can earn a difference by selling futures, these differences can be used to buy some futures, so the value of your investment in futures can remain unchanged whether the futures go up or down.
However, when investors feel that the market trend is clear and they can unilaterally decide to buy or sell, they will sell or sell one of the positions, which is called opening positions (if they are optimistic about the market outlook, they will sell the position, if they are optimistic about the weak market outlook, they will buy and close positions).
In a broader sense, it can be used for yen carry trade. The spread of Japanese yen means that the transaction is to borrow Japanese yen and deposit it in foreign currency at a high interest rate. Or buy foreign currency assets. If you borrow Japanese yen to deposit foreign currency, if the currencies are equivalent, and the currencies of the two currencies have not changed much, because the interest rate of Japanese yen is low and the interest rate of foreign currency you deposit is high, you can benefit from the interest difference. If you buy foreign assets such as stocks, you can borrow money at low interest to invest. This can be called generalized lock, but this lock is not exactly the same as futures lock. Because borrowing money or saving money is not equivalent, if the yen rises and the interest rate falls, the difference will not be guaranteed. Therefore, when the Japanese yen has an upward trend, there will be a problem of opening the yen spread. This will terminate foreign currency deposits or sell foreign currency investments, because the locked position of this carry trade is huge at present, and a bad one may lead to a global economic crisis.
The following is the crisis of yen spread mentioned by Oriental Daily:
Spreads and positions are in full swing, waiting for the market to fall (2007-03-06 05:35:00)
The Oriental Daily reported that the global stock market had just experienced "Black Tuesday" last Tuesday, and investors' panic had just subsided. Unexpectedly, the first trading day of this week was "Black Monday", and Asian stock markets generally fell by more than 2% to 4%, which was even worse than last week's stock market decline. Among them, the disaster in Hong Kong stocks is the most serious. The health index plummeted 777 points throughout the day, the biggest drop since the 9 1 1 incident in the United States.
Of course, the Hong Kong stock market crash has its own factors, such as? The poor performance of HSBC Holdings and the impact of macro-adjustment on Chinese concept stocks in the Mainland have exhausted the Hong Kong stock market. However, it can not be ignored that the special factors of hedge fund's continuous liquidation arbitrage trading have begun to ferment in the market. Last month, the Bank of Japan announced that it would raise interest rates for the second time to get rid of the era of zero interest rates, and threatened to continue to raise interest rates in order. Therefore, in recent years, hedge funds that borrowed a lot of money at low interest rate in Japanese yen must face the reality, gradually lift their arbitrage transactions and return their funds to Japanese yen, which has caused similar "divestment" effects on the global investment market.
Frankly speaking, hedge funds use low-interest yen as their investment capital, making waves everywhere, leading to excess international hot money and excessive speculation in the global asset market, forming a large or small asset bubble, like a financial bomb, threatening the stability of the global financial market. This distorted situation will need to be adjusted one day, but unfortunately, market participants turn a blind eye to it. Now that the problem has finally emerged, we must face it seriously and stop adopting the ostrich policy. Judging from the recent rebound of the yen exchange rate and the weakening of the global asset market, hedge funds seem to be "defusing bombs". We don't know how long this process will take, but fortunately, despite the great impact on the market, the adjustment order is still good and has not caused panic in the global stock market.
Even so, local regulators cannot stand idly by. They must be prepared to pay more attention to the impact of arbitrage transactions on the market, especially hedge funds, and take preventive measures as soon as possible. Previously, hedge funds speculated on the commodity market, which eventually ended in a short position, leading to the closure of many hedge funds or financial difficulties. Countries have been wary and worried about repeating the mistakes of long-term capital management companies and triggering global financial risks. However, the participants in the commodity market are mainly enterprises and institutional investors, and their influence is still limited. Once the problem involves the stock market, I believe the impact will be deeper and wider. If the regulatory authorities do not handle it properly, it is very likely to shake the stability of the overall economy.
Although it is difficult for Hong Kong stocks to be immune, with the support of the mainland stock market, Hong Kong stocks are actually superior to other markets. We might as well note that even though the China stock market suffered the same damage in this stock market crash, the Premier's work report published during the two sessions insisted on the steady development of the stock market, which indirectly appeased mainland investors and made the decline of the mainland stock market relatively moderate. It can be seen that the stock market closely monitored by the central government is not easy to rise or fall.
No matter how long and deep the stock market adjustment is, we believe that as long as there is no confusion in market transactions, investors can enter and exit in an orderly manner, and regulators can also ensure that false and abnormal transactions are absolutely eliminated. , is enough. After all, the stock market must have ups and downs. Even if the market has fallen sharply recently, as long as the basic economic factors of Hong Kong and the Mainland remain unchanged, in the long run, the stock market will start to rise again after falling. Even if the current market decline is heartbreaking, investors need not be too pessimistic about the prospects.
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