The position limit is one of the means for the exchange to control risks: the higher the position limit, the more positions customers can hold, and the greater the risk of default; On the other hand, the lower the value of the position limit, the customer will not be able to hold large-scale positions, and the risk of default will naturally decrease.

With the approaching of the delivery date, the harm caused by default is greater, so the exchange will seek ways to reduce the risk of default. At this time, reduce the position limit, that is, customers are not allowed to hold multiple positions to reduce the risk of default.

Corrigendum by the way: The teacher of "Futures Practice Examination" in 233 online school made a complete mistake when talking about the position limit. "Usually, the position limit standard is high, and the position limit standard near delivery is low". The standard here refers to the value of the position limit, not the degree of looseness. The teacher misunderstood the standard of location restriction as loose, which misled other children.