Short selling refers to the phenomenon that when shorting stocks or futures, brokers are forced to close their positions because the market fluctuation is too large and the margin cannot deduct the losses. Short-selling profits from falling asset prices. Shorting stocks and futures requires a certain margin. The theoretical margin is 10% of the actual position value, which means that the actual reverse fluctuation that investors can bear is only 10%.

Futures market first appeared in Europe. As early as ancient Greece and Rome, there were central trading places, bulk barter transactions, and trading activities with the nature of futures trade.

The original futures trading was developed from spot forward trading. The first modern futures exchange 1848 was established in Chicago, USA, and 1865 established a standard contract model. In 1990s, China Modern Futures Exchange came into being.

There are four futures exchanges in China: Shanghai Futures Exchange, Dalian Commodity Exchange, Zhengzhou Commodity Exchange and China Financial Futures Exchange. The price changes of its listed futures products have a far-reaching impact on related industries at home and abroad.

The initial spot forward transaction is a verbal commitment by both parties to deliver a certain amount of goods at a certain time. Later, with the expansion of the scope of transactions, oral promises were gradually replaced by sales contracts.

This kind of contract behavior is becoming more and more complicated, and it needs intermediary guarantee to supervise the timely delivery and payment of goods. So the Royal Exchange, the world's first commodity forward contract exchange, opened in London on 157 1. In order to adapt to the continuous development of commodity economy, improve transportation and storage conditions and provide information for members, 1848, 82 businessmen initiated and organized the Chicago Board of Trade (Board 185 1 Chicago Board of Trade to launch forward contracts; 1865, Chicago Grain Exchange introduced a standardized agreement called "futures contract" to replace the previous forward contract.

This standardized contract allows manual contract trading, and gradually improves the margin system, thus forming a futures market specializing in standardized contract trading, and futures become investors' investment and financial management tools. 1882 exchange allows hedging to be exempted from performance obligations, which increases the liquidity of futures trading.

The background of China futures market is the reform of grain circulation system. With the cancellation of the policy of unified purchase and marketing of agricultural products and the liberalization of most agricultural products prices, the market is playing an increasingly important role in regulating the production, circulation and consumption of agricultural products. The ups and downs of agricultural products prices, the undisclosed and distorted spot prices, the ups and downs of agricultural production, and the lack of value-preserving mechanism of grain enterprises have attracted the attention of leaders and scholars.

Whether we can establish a mechanism that can not only provide price signals to guide future production and business activities, but also prevent market risks caused by price fluctuations has become the focus of attention. 1February, 988, the leaders of the State Council instructed relevant departments to study the foreign futures market system and solve the problem of domestic agricultural product price fluctuation. 1In March, 1988, the government work report of the First Session of the Seventh National People's Congress put forward: actively develop all kinds of wholesale trade markets and explore futures trading, which opened the prelude to the research and construction of China's futures market.