Incremental Position

What is position-by-position? What is full position?

Position-by-position and full position are professional terms in investment. Some investors may be in contact with them, but they don’t know much about them. Let’s talk about them in detail.

Position-by-position
Position-by-position means that in position-by-position mode, a certain margin will be locked when placing an order as the maximum loss of the position. When the price fluctuation is large and the system is forced to close the position, the margin of the main position will not change, and the loss will be controlled within a certain range.

Full position
In full position mode, all funds in the personal account can be used as margin for the position, so that the risk resistance is stronger, and sufficient funds can ensure that the account will not be forced to close the position. The probability of full position being forced to close is small, and once the price fluctuation is huge, the loss will be greater.

The difference between position-by-position and close position

1. The margin of the two is different
From the above description, we can know that the meaning of position-by-position and close position is different, which is reflected in the margin. The margin of full position is higher than that of position-by-position. The margin of full position is all the funds in the account, while the margin of position-by-position is fixed and unchanged. The margin has been determined when placing an order.

2. The two have different risk resistance
Because the margin of full position is higher than that of position by position, the risk resistance of full position is stronger, because it can withstand more fluctuations, and the probability of forced liquidation by the system is relatively low.

3. Different losses
Full position and position by position have their own advantages and disadvantages. Full position can withstand more fluctuations. Once forced liquidation by the system, the economic loss caused is very large. Because the margin of position by position is fixed, the position is relatively small. Even if it is forced liquidation by the system, the loss caused is much lower than that of full position.

4. Different investment period
Full position is suitable for long-term investment. If the margin is sufficient, the purchased product will always exist and will be sold after profit. Position by position is more suitable for short-term investment, because the margin is relatively small, the fluctuation point that can be tolerated is also low, and it cannot be held for a long time.

The above is the content about the full position of position by position and position by position. Position by position and full position have different meanings and different risk resistance. Full position is suitable for long-term investment, and position by position is suitable for short-term investment.

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