These are the hidden dangers caused by the price limit system and the t+1 trading system. When the market becomes capable of allocating large amounts of capital, these two systems are the potential source of continuous falling limits. These are the people who allocate long funds to open a position and buy a stock.

Once Greedy buys, his capital drops to close to 0 after two lower limits. The financing company will force liquidate the position and sell the stocks he holds. The target of a large number of selling orders hits the lower limit. This falling process triggers another group of people to liquidate their positions.

They were forced to liquidate their positions again, so they continued to fall to the limit the next day. However, there were still many people raising money every day. When the price was the lowest a few days ago, the formal financing amount in the two cities was still more than 1 trillion, not to mention those outside the market who lined up when the stock fell to the limit.

There will be no opportunity to sell the positions that are liquidated later, so the capital allocation companies will rush to sell the customers' stocks tomorrow. They will not lose their own money. As long as the customer's principal is lost, they must sell the stocks to compensate them for lending them.

Therefore, the lower limit limit is a disaster. If the price plummets all at once, those leveraged positions will not wait until tomorrow to line up to pay the lower limit price. This is the lower limit effect of the lower limit. Those who have liquidated their positions do not understand what stop loss is because t+1

It has become a habit for more than ten years to wait one day after buying before selling. After buying in a mature t+0 market, you can set a stop loss price to mechanically stop the loss. You will not have to wait until the position is liquidated before being forced to stop the loss.

It is simply too late to rely on artificial manual stop loss in fast market conditions. However, our system refuses to remove t+1 and advocates value investment. These are the source of trouble.