Although the initial capital of stock trading can be very low, it means that it is difficult for you to make big money. At this time, some people consider stock market financing. Sometimes we also call it fund-raising stock trading, which means the same thing, that is, adding leverage to stock trading. So what are the risks of this operation?

Because the financing of stock purchase has a certain leverage, the corresponding profit and loss will also increase, and the loss will be forced to be realized to a certain extent, so the financing of stock purchase is more risky than buying and selling stocks with its own funds.

Financing means that investors pledge their own funds or securities, borrow money from securities companies to buy securities, and repay the principal and interest of securities companies within the agreed time limit. Investors can choose to sell securities to repay their funds, or raise additional funds to repay their funds.

Securities and stock investors borrow and sell securities from securities companies with their own funds or securities as collateral, return the same variety and quantity of securities to the securities companies within the agreed time limit, and pay corresponding fees.

When financing, when the price rises after buying securities, investors profit; When the price falls after buying securities, investors must bear the losses.

In securities trading, when the price rises after the securities are sold, investors need to buy back the securities at a higher position, sell them low and buy them high, and investors need to bear the losses; When the stock price falls after selling, investors buy back the stock at a lower price, and the difference between selling high and buying low is part of the profit of investors in securities trading.

Margin trading has a certain leverage structure, and the profit and loss will expand accordingly. When the loss reaches a certain level, there is the risk of forced liquidation, so the risk of margin trading is greater than that of general securities trading. Investors engaged in margin trading must be fully aware of the risk tolerance, not only the concept of doubling the income, but also the concept that the loss may be greater.

The threshold for investors to enter the margin trading is relatively high, with the account opening time exceeding 6 months and assets exceeding 500,000 yuan.

In fact, there are still many risks in financing stock trading. In addition to the risks inherent in the stock market, financing itself is also risky, because you need to pay interest when financing, no matter whether you earn or lose, you need to pay this interest.