How to protect yourself to make profits when the market is changing dramatically?

Market analysis/

As we all know, the financial derivatives market is turbulent, and we need to face the unknown market at any time, which requires us to have a strong sense of self-protection in all aspects, so as to achieve the maximum risk resistance.

This paper will use examples to analyze how to properly deal with the volatile market in the financial derivatives industry, so as to achieve self-protection and risk control.

Ordinary investors

First of all, for ordinary investors, in the face of sharp fluctuations in the market and the amplitude is significantly larger than usual, we need to consider whether their account positions can withstand such sharp fluctuations.

Take the 15 minute K-line for example. Under normal fluctuation, there is a big positive line, and the number of long / short points is about 20-30 points. If the market suddenly intensifies, the fluctuation of a 15 minute K line may reach about 60-80 points. In this case, ordinary investors will make mistakes in the direction of trading, which may cause their losses to be 3-4 times of the normal period.

At this time, investors are thinking more about relying on their own luck and direction, believing that they can make more profits. On the contrary, they forget the position control and management that they attach great importance to in the normal period.

Therefore, it is necessary to remind ordinary investors that they need to reduce the number of traders, control the position risk and pay attention to the situation of available margin when encountering drastic market fluctuation. >Institute of foreign exchange

Secondly, ordinary investors need to pay attention to the adjustment of leverage before the market fluctuates sharply, so as to avoid unnecessary impact on their own positions.

Investors in the layout of long-term trading, we should focus on the next risk events, evaluate their positions for layout.

As an important part of the financial derivatives market, platform business also plays a very important role in the fierce market. Platform providers need to maintain a relatively stable spread in the whole volatile market, provide more accurate quotations, and protect themselves from unnecessary losses.

Therefore, the platform business needs to do more and more detailed work. At present, the market generally adopts the method of reducing leverage to reduce the possible losses caused by the risk market.

Therefore, before the big market is expected, banks choose to reduce leverage to avoid risks, and platform providers will adjust the leverage ratio provided to customers, and finally this process will be fed back to customers' trading accounts.

We hope that we can pay more attention to the potential risks while trading, avoid or establish our own risk control mechanism in time, and finally achieve lasting profits.

[disclaimer] the publication of this article by finance managers for the purpose of transmitting more information does not mean that they agree with their views or confirm their descriptions. The content of this article is for reference only, and does not constitute an investment proposal. Investors operate on this basis at their own risk

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