In the investment market, most restrictions are set up to protect the rights and interests of investors. As far as the position limit system is concerned, the position limit system can prevent the market from being manipulated by a few people, and at the same time avoid the market risk from being concentrated on a few investors. So, what does the futures position limit system include?

What does the futures position limit system include?

1 Futures will adjust the position limit according to the margin, mainly to prevent the market crisis from being excessively concentrated on a few traders and to prevent market manipulation.

Generally speaking, the futures exchange stipulates that a member's unilateral position on a contract shall not exceed 15% of the total position of the contract on the exchange, otherwise the exchange will forcibly close the excess position of the member.

3. Limit the positions of customers. Each customer can only use one trading code, and the exchange also limits the total positions under each customer code.

Summary: In the market, in order to prevent large investors from manipulating the market, most exchanges implement coding management for customers represented by member units. Futures exchanges will regulate the trading scale of members according to their tolerance to the crisis, and in order to prevent the market crisis from being excessively concentrated on a few members, exchanges in many countries have carried out regulation.