1. There are two kinds of forced liquidation in futures: the forced liquidation of futures companies (or self-operated members) by exchanges and the forced liquidation of customers by futures companies.
(1) The exchange's compulsory liquidation of futures companies is a compulsory measure taken when the futures company's funds are insufficient to maintain its positions (for example, because the margin ratio is increased) or when the position limit is reduced in the delivery month (for example), usually the redundant positions are leveled.
(2) The futures company's forced liquidation of customers refers to the forced liquidation of customers due to insufficient funds and excessive positions.
2. In futures trading, when the loss reaches zero margin, the futures trading company will force investors to close their positions, and for futures investment with a risk greater than 100%, the futures company will also force them to close their positions.
3. Futures companies will generally notify investors by telephone and explain the reasons for compulsory liquidation before compulsory liquidation. Futures investment is risky, and forced liquidation often occurs. Investors need to evaluate their risk-taking ability before investing in futures, and then invest according to the situation.
1, futures are actually not a commodity, futures are a trading contract, and the concept of spot as opposed to futures is an actual commodity. Futures specifically refers to the contract to trade a certain quantity and quality of the subject matter at a certain time and place in the future, so futures actually refers to the spot transaction in the future, and futures trading is two-way, which can not only borrow money to buy goods, but also borrow money to sell goods in the future to obtain funds. Futures investment implements the margin system, and a large number of transactions can be carried out with only a small amount of funds.
2. Liquidation is a term derived from commodity futures trading, which refers to the trading behavior of one party in futures trading to cancel the futures contract bought or sold before. Closing a position is a general term for selling stocks bought by bulls or buying back stocks sold by bears in stock trading.
3. Closing positions can be divided into hedging closing positions and compulsory closing positions. Hedging liquidation refers to the liquidation of futures contracts previously sold or bought by futures investment enterprises by buying futures contracts on the same futures exchange and selling futures contracts in the same delivery month. Forced liquidation refers to the forced liquidation of the position of the holder by a third party other than the holder (futures exchange or futures brokerage company), also known as liquidation or liquidation.