What is the harm of paying in advance for futures?
The harm of paying futures bills in advance is that it will make us trade too much in the day, thus increasing our investment cost. Paying the bill in advance in futures trading is equivalent to filling out the entrustment order, but it has not been concluded. When the futures price reaches our trading opportunity, at least it is ambushed, then we can close the position. However, we must know that such a setting is only useful when consolidating the market. Once we reach the unilateral market, our losses will be obvious.
In the unilateral market, we often set up a prepaid order to sell, and this prepaid order will be broken quickly, thus increasing our losses, especially if we continue to short in the unilateral rising market. Sometimes it is clear that the market is suitable for doing more, but because the prepaid order in the morning is short, the result of this reaction is to make a reverse order at an inappropriate time.
In this regard, the harm of advance payment in futures mainly lies in the untimely withdrawal of orders, and the change of futures market is often greater than that of stocks, so the setting of advance payment in futures is also relatively large.