Leverage trading is also called margin trading. The contract value is multiplied by the margin ratio to get the amount of margin that should be paid for a stock index futures contract. Stock index futures implement a daily debt-free settlement system, and the margin in the investor's account on each trading day cannot be lower than the prescribed level. Assume that the Hong Kong Hang Seng Index futures quotes the Hang Seng Index as 17,315 points, then the value of a futures contract is HKD 865,750. If the futures company stipulates that the margin ratio is 10%, the margin for one Hang Seng Index futures is HK$86,575. The lower margin level leads to traders defaulting when the degree of adverse daily price changes is greater than the margin account balance. In addition, it encourages speculative funds to establish positions and intensifies market volatility. Higher margins will increase transaction costs and lead to a decrease in stock index futures trading volume. In summary, the margin setting level must be weighed against the different consequences of high versus low.