The risks in the spot market are diverse, and the risk most closely related to investors is the risk of trading losses. There are three main factors that lead to spot trading risks, namely adverse market conditions, heavy positions and tight holdings. For investors who switch from the securities market to the spot market, heavy positions and tight holdings of stocks are typical characteristics of them. Because of this, they need to have an understanding of spot trading risks and methods to control trading risks.

1. The risk of wrong judgment on the market outlook

An important feature of spot trading that is different from stock trading is that spot has a short-selling mechanism. There is a profit opportunity regardless of the rise or fall of spot. It is our judgment on the market outlook that is accurate. The market outlook here can be minutes, hours, days, or weeks after entering the market. The consequence of wrong judgment is the loss of funds. The occurrence of this type of risk is mainly caused by investors' errors in judging the trend. Under normal circumstances, investors who are not qualified to conduct in-depth analysis of fundamentals should grasp the application of indicators for judging trends, mainly the application of the moving average system. If you operate according to the moving average system, there will be no big losses.

2. The risk of wrong entry time

The so-called risk of wrong entry time means that even if an investor’s judgment of the later general trend is accurate, the risk of wrong entry time may Mistakes will lead to losses when entering the market, which will have a negative impact on operating psychology. The final entry time is not the highest and lowest points on the market chart, because it is difficult for us to ensure that we enter the market at the top and bottom every time, and there is only one top and bottom. In other words, in a bull market, you sell short in the long term. There is only one chance to go long, but there are N times to succeed in going long. Investors should wait patiently for top and bottom signals or patterns to appear on the chart.

3. The risk of overweight positions

The margin system of spot trading determines that the profits and losses of spot trading are effectively amplified. You use 20% of the funds to purchase a stock worth 100 % of commodity spot contracts, profits and losses may far exceed the margin on your account before opening a position. This is the risk of spot trading, and it is also the charm of spot trading. The risk of overweight positions will cause considerable harm to investors in the early stages of building a position. When you judge that the market is turning upward, do not intervene with a heavy position at once. You can step in with a small order to prevent the last crackdown on your confidence.

4. Risk of holding positions overnight

Short-term commodity spot prices fluctuate violently, and price continuity is poor. There is often the possibility of prices jumping short and opening higher or lower. If you hold If your position stays overnight and the price moves in the direction that is unfavorable to your position, it will cause you a large floating loss at the moment the market opens. At this time, your psychology is quite fragile, because the 30 minutes after looking at the market often form the high point and high point of the day. During this period, there was a big difference between the long and short sides in the direction of the daily trend, and the fluctuations were large. If you hold a losing position, it will be difficult to withstand the pressure of continued expansion of losses. But when you close your position, you may end up at the highest point or lowest point within 30 minutes of the opening. After the intraday trend comes out in 30 minutes, you don’t dare to chase it because you have just been washed out.

5. Risks caused by emergencies

International and domestic sudden political and economic crises, exchange rate changes, terrorist attacks, and abnormal changes in weather will all cause commodity spot losses in the short term. Violent fluctuations. The overnight risk of stock index futures is relatively small, because the linkage between the stock markets of various countries is smaller than the linkage between commodity futures, because there are cross-market arbitrage opportunities for commodity spot goods, but there are few such arbitrage opportunities between the stock markets of various countries. .