Xiaobian for you to introduce.
Close position refers to the behavior of futures traders to buy or sell futures contracts with the same variety, quantity and month of futures contracts but in the opposite direction, and to settle futures trading. Simply put, it is “sell when you bought before, buy when you sold before”.
The whole process of futures trading can be summarized as opening, holding, closing or physical delivery.
Build a WAREHOUSE TO ALSO CALL OPEN A WAREHOUSE, IT IS TO POINT TO A TRADER NEW BUY OR NEW SELL THE FUTURES CONTRACT OF CERTAIN AMOUNT.
Buying or selling a futures contract in the futures market is equivalent to signing a forward delivery contract.
If the trader holds the futures contract until the end of the trading day, he must settle the futures trade by physical delivery or cash clearing.
However, physical delivery is a minority, and most speculators and hedgers generally choose to sell or buy back the futures contracts they have bought before the end of the last trading day.
That is, through an equal and opposite number of futures trading to offset the original futures contract, in order to settle futures trading, release the expiration of the obligation to physical delivery.
The act of buying back sold contracts, or selling bought contracts, is called unwinding.
Unwinding refers to the behavior that futures investors buy or sell stock index futures contracts with the same variety, quantity and delivery month of the futures contracts they hold, but in the opposite direction, in order to end the trading of stock index futures.
Also CAN UNDERSTAND FOR: OPEN POSITION IS TO POINT TO THE TRADING BEHAVIOR THAT THE TRADER CLOSES A POSITION, THE WAY THAT CLOSES IS TO MAKE OPPOSITE HEDGE TRADE IN VIEW OF THE DIRECTION THAT HOLDS A POSITION.
A closing position in futures trading is equivalent to a selling.
Since futures trading has a two-way trading mechanism, which corresponds to opening positions, there are also two types of closing positions: buy closing positions (corresponding to selling opening positions) and sell closing positions (corresponding to buying opening positions).
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