10 times leverage is a high proportion. If you invest in the right direction, you will make a lot of money. However, if a careless investment is in the wrong direction, then it may encounter short positions. If you calculate carefully, basically a 9% decline will lead to short positions.
Give an example to illustrate. If it is 10 times leverage, it means that your own funds are10 million, and then borrow10 million, making a total of110 million to invest in stocks. In this case, if you buy all of 1 1 10,000 yuan into stocks, if the stock price drops by 9%, it means that your total market value has fallen to 100 1 10,000 yuan, which means that your total market value has lost 990,000 yuan, plus transaction costs such as commission and stamp duty, as well as interest expenses. And a 9% drop is already happening.
In the process of 10 times leverage operation, 10 million yuan is a loan, and interest needs to be repaid. If the annual interest rate is around 8%, that is, 800,000 loan interest needs to be repaid in one year, the average monthly interest is 66,600 yuan, and the average daily interest is about 2 19 1 yuan. Therefore, if it is 10 times leveraged trading, it will fall by 9%, and it will encounter short positions.
In the process of investing in the stock market, it is best not to use financing leverage, let alone to use high leverage for stock trading, so that the risk will be lower, even if you lose money, you will not lose too much, and you will not lose all your money. As we all know, if it's all your own money, even if you invest100000 and the stock drops by 50%, then you can still have a market value of 5 million, and you still have a chance to wait for the investment stock to turn over. However, if it is financing stock trading, and the stock falls by 50%, there may be short positions, loss of principal and no chance to turn over.
To sum up, in the case of 10 times leverage, the risk is very great. If you invest in all stocks, if the market value drops by 9%, it will basically explode and your money will basically be lost.