Margin trading means that customers only need to pay a certain proportion of the contract value when buying and selling foreign exchange spot contracts or futures contracts, but do not need to pay in full. The profit and loss are determined according to the contract amount, so that the profit and loss of spot contracts and futures transactions are leveraged.

The margin of spot contract is different from that of futures contract. Specifically, the former is the advance payment or margin of the transaction, and the latter is not only used as the advance payment or margin of the transaction, but also as the financial guarantee for the daily price fluctuation risk settlement of futures contracts.

Margin trading system refers to the margin trading system implemented in stock index futures trading in order to ensure performance and safeguard the legitimate rights and interests of both parties. Anyone who participates in stock index futures trading, whether the buyer or the seller, must pay the deposit according to the regulations of the exchange where he is located. Margin is the financial guarantee for the trader to perform the contract.

Margin trading system has a certain leverage. Investors do not need to pay the full amount of the contract value, but only need to pay a certain percentage of the deposit to trade. The leverage effect of the margin system not only magnifies the income, but also magnifies the risk. In case of extreme market, the loss of investors may even exceed the principal invested.