In the stock market, after registering a margin trading account, you can perform more trading operations, such as adding leverage. But it has certain thresholds, including the need for 500,000 securities assets. Therefore, if investors want to do stock financing, do they have to have 500,000? Should I increase leverage when doing stock financing? In this regard, this article will partially discuss this through relevant common sense for your reference.
Does stock financing require 500,000 yuan?
To register a stock margin trading account to perform stock financing operations, you must have 500,000.
In the implementation details of margin trading and securities lending transactions of the stock exchange, the requirements for individual investors to register margin trading and securities lending accounts are as follows: they have been engaged in securities trading for half a year or more, the risk tolerance assessment meets the standards, and the daily average of securities assets in the last 20 trading days is not If the amount is less than 500,000 and there is no major default record, the member (securities company) can open a credit account for it.
If investors encounter an institution that provides services that enable financing operations without thresholds, then such services are definitely illegal. Capital losses caused by investors’ participation will not be protected by law. We recommend this situation Report directly.
If it is enough, should we increase leverage?
If you don't want to use leverage, just use a regular account to participate in investment. Investors will choose stock financing only if they need to increase leverage.
Increasing leverage is equivalent to increasing expected returns and expanding actual risks. The maximum ratio of financing leverage is 1:1. Investors need to choose the specific leverage ratio based on their actual situation. Although the highest leverage of 1 times doubles the risk, as long as the stocks invested after financing perform poorly, When investors are unable to replenish their margin in time, securities companies will force their positions to be liquidated in order to avoid losses to their own lent funds. In addition, if the market runs and cannot be liquidated, the losses incurred by the securities companies lending funds will also be recorded on the investors. Therefore, increasing leverage must be done with caution.
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