1 thought on “Leverage trading risk”

  1. Frequent financing trading has the characteristics of leverage trading. When engaged in financing trading, investors should face the risk of making mistakes and losses like ordinary transactions. As the investment scale of investors provides a certain percentage of transaction leverage in the scale of investors' own investment, losses will be further enlarged. For example, investors buy a stock for 1 million yuan, and the stock fell from 10 yuan/share to 8 yuan/share. The loss of investors was 200,000 yuan, a loss of 20%; 2. Based on a 50%margin ratio, it raised 2 million yuan to buy the same stock. The stock fell from 10 yuan/share to 8 yuan/share. The loss of investors was 400,000 yuan, with a loss of 40%. Investors should soberly recognize the high -yield and high -risk characteristics of leverage transactions.
    In addition, margin margin trading needs to pay interest fees. After investor financing and buying a securities, if the price of securities falls, investors must not only bear investment losses, but also pay financing interest; after investor margin selling a securities Investment losses will not only bear the increase in the rise in securities prices, but also pay the securities lending fee.

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