Exchanges and futures brokerage companies have to settle accounts every trading day. When the investor's margin is insufficient and below the specified proportion, the futures company will forcibly close the position.
Sometimes, if the market is extreme, there will even be short positions, that is, all the funds in the account are lost, and even the futures company needs to pay the part whose losses exceed the account margin.
When selling or buying the same amount of futures in the futures market, after a period of time, when the price changes make the gains and losses in the spot trading offset, the losses in the futures trading can be offset or compensated.
Extended data:
The principle of avoiding futures risks;
There are generally two ways to close futures trading positions, one is hedging and the other is physical delivery. Physical delivery is to fulfill the responsibility of futures trading through physical delivery.
Therefore, futures delivery refers to the behavior of buyers and sellers of futures trading to make physical delivery of their respective expired open contracts in accordance with the provisions of the exchange when the contracts expire and end their futures trading. Physical delivery accounts for a small proportion of the whole futures contract, but it is the existence of physical delivery mechanism.
Synchronize the change of futures price with the change of related spot price, and gradually approach with the approaching of contract expiration date. Physical delivery is essentially a spot transaction, but physical delivery in futures trading is a continuation of futures trading and is at the intersection of futures market and spot market.
It is the bridge and link between the futures market and the spot market. Therefore, the physical delivery in futures trading is the basis of the existence of the futures market and the fundamental premise for the two major economic functions of the futures market to play. The two functions of futures trading provide a stage and foundation for the application of the two trading modes in the futures market.
The price discovery function needs the participation of many speculators, a lot of market information and abundant liquidity, and the existence of hedging transactions provides tools and means for avoiding risks. At the same time, futures is also an investment tool. Due to the fluctuation of futures contract prices, traders can make use of arbitrage to earn risk profits through contract spreads.
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