Xiao Bai Finance Class: What is a Margin Call

Dear ones, today we must talk about a super scary investment "trap" — margin call! Simply put, a margin call means that your investment account not only loses all its principal but also owes money to the platform! 😱 It's like you took out a loan to open a milk tea shop, but ended up not selling a single cup, and in the end, you lost all the rent and equipment money, plus you are in huge debt!​

💥 How does a margin call happen?​

Many high-risk investments, such as futures, foreign exchange, and leveraged stock options, play a game of "small bets for big returns" — leverage. For example, you only have 10,000 yuan, but with 10 times leverage, you can control 100,000 yuan in funds. When the market is good, you make a fortune, but once the market moves against you, your losses can also be magnified by 10 times! When losses exceed the account margin and you do not add funds in time, the platform will forcibly close your position, and at that moment, all your money will be lost!​

💔 Real Blood and Tears Lessons​

Previously, there was a stock investor who used 5 times leverage to trade stocks, initially making 200,000 yuan, but when the market crashed, not only did he lose all his profits, but he also owed the brokerage 150,000 yuan! One night back to square one, so tragic…​

📌 Avoiding Pitfalls Guide​

✅ Newbies must not invest recklessly!​

✅ Always reserve "life-saving money" before investing; don't go all in!​

✅ Learn more about investment knowledge; if you don’t understand, don’t touch it!​