Under the leverage of 10 times, when the subject matter purchased by investors rises by 10%, the long investors will realize the yield of 100% under the leverage of10 times. When the subject matter purchased by investors fell by 65,438+00%, the long investors lost to 65,438+000% under the action of 65,438+00 times leverage, that is, short positions. Therefore, when the leverage of futures is 10 times and the decline is 10%, (the increase is 10%), take long positions (short positions).
For example, under the leverage of 10 times, investors make 100 lots on a futures target. At the time of purchase, the price of the subject matter is 40 yuan. After a period of time, the price of the subject matter was 36 yuan, which means it fell by 10%. At this time, the loss rate of investors has reached 65,438+000%, resulting in short positions.
However, in the absence of extreme market conditions, when the investor's loss rate reaches 90%, the futures company will inform the investor to add margin, and if the investor does not add margin, it will be forced to close the position by the futures company.
Forced liquidation is also called forced liquidation, which is also called being cut, cut and exploded. It refers to the situation that the customer's rights and interests in the investor's margin account are negative under some special circumstances. A short position means that the loss is greater than the margin in your account. After the company is forced to draw a tie, the remaining funds are the total funds MINUS your losses, and generally there will be a part left. Commonly used in spot gold and futures trading.
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.
Forced liquidation is also called forced liquidation, and it is also called being cut/cut/exploded. According to the different subjects of compulsory liquidation, compulsory liquidation can be divided into exchange compulsory liquidation and brokerage compulsory liquidation.
According to the different reasons of forced liquidation, forced liquidation can be divided into the following categories:
Forced liquidation due to failure to fulfill the obligation of additional margin. According to the rules of the Exchange, a margin system is implemented for futures trading, and a certain percentage of margin must be paid for each transaction. When the market changes unfavorably, that is, when the market reverses and changes in the opposite direction, members or customers should also add margin according to the trading rules and the contract when entering the delivery month. If the member or customer fails to fulfill the obligation of additional margin within the specified time, the trading ownership will forcibly close the position held by the member or brokerage company.
Forced liquidation due to violation of regulations. If a member or customer violates the trading rules of the exchange, the trading ownership will be forced to close the position and violate the trading rules. It mainly includes: exceeding positions in violation of position restrictions; Failing to report or making a false report in violation of the large household reporting system; Carry out futures business for those who are prohibited from entering the market; Brokerage companies engage in self-operated business; Manipulate the market together; And other violations that require compulsory liquidation.
Forced liquidation due to temporary changes in policies or trading rules. This often happens in previous years, and trading rules are often modified because of the temporary regulations of policies or regulatory authorities, or can not be implemented normally for the time being.
The compulsory liquidation right of the exchange means that when the spread loss between the open contract held by the customer and the current transaction settlement price exceeds a certain proportion, and the customer fails to pay the additional margin within the prescribed time limit, the futures brokerage company has the right to compulsory liquidation of the customer's hand contract, so as to reduce the margin level and risk and ensure that the customer is free from greater economic losses, and the consequences of compulsory liquidation shall be borne by the customer.
The forced liquidation of customers by futures companies refers to the forced liquidation of customers due to insufficient funds and backlog.