What are the main risks of futures?
1 legal risk. First, investors may choose to open an account without the qualification of futures brokerage business, and second, futures companies may operate illegally.
2 market risk. Futures use margin trading, not leverage, and smaller fluctuations can be amplified into larger profits and losses.
3 operational risk. There may be technical failures in the quotation system and the order placing system, which makes it impossible to obtain quotations or place orders; Investors may also make mistakes in their operations.
4 Danger of explosion. When the market is unfavorable and investors' margin is insufficient, investors may often face the problem of additional margin. If they fail to make up the margin within the specified time, they will be forced to close their positions according to the regulations, which may bring huge losses to investors.
5 Joint risks. When a clearing member who settles for investors or other investors under the same clearing member fails to make up the deposit within the specified time, or for other reasons, CICC forcibly closes the brokerage account under the clearing member, the assets of investors may suffer losses due to joint forced closing.