Price limit

The price limit system, also known as the daily maximum price fluctuation limit, means that the trading price fluctuation of futures contracts in a trading day should not be higher or lower than the specified price fluctuation range, and the quotation exceeding this price fluctuation range will be regarded as invalid and cannot be traded.

Compulsory liquidation system

The compulsory liquidation system refers to the compulsory liquidation system implemented by the exchange to prevent further risk expansion when the trading margin of members or customers is insufficient and not replenished within the specified time, or when the positions of members or customers exceed the specified limit, or when members or customers violate the rules. Simply put, it is a compulsory measure for the exchange to close the position of the violator.

Risk reserve

The risk reserve system refers to the system in which a futures exchange draws a certain proportion of funds from the transaction fees charged by its members as a reserve to ensure the exchange's performance. The establishment of exchange risk reserve is to provide financial guarantee for maintaining the normal operation of the futures market and make up for the losses caused by unforeseen risks. The exchange should not only extract the risk reserve from the transaction costs, but also establish the special risk reserve for stock index futures paid by members in view of the special risks of stock index futures. The special risk reserve for stock index futures can only be used to provide financial guarantee for maintaining the normal operation of the stock index futures market and make up for the losses caused by unforeseeable risks of the exchange. Risk reserves must be accounted for separately and stored in special accounts, and shall not be used for other purposes except to make up for risk losses. The use of risk reserve shall follow the prescribed legal procedures, be approved by the board of directors of the Exchange, and be reported to the China Securities Regulatory Commission for the record, and be carried out in accordance with the prescribed purposes and procedures.