margin trade

In the Taiwan stock market, credit trading (margin buying and short selling) serves as a critical mechanism for observing market leverage and investor sentiment. Unlike institutional investors with ample capital, retail investors often face capital constraints and therefore resort to margin buying to  increase their purchasing power. Consequently, margin data serves as a key barometer for retail trading heat.  Key indicators for monitoring credit trading include daily margin/short volume, balance, margin utilization rates, and—most crucially—the Margin Maintenance Ratio (MMR).  The MMR is a core metric used to assess the risk status of margin accounts and determine how close investors are to a margin call. Brokers set specific MMR thresholds to mitigate default risks during periods of high market volatility.

In Taiwan, retail investors use margin trading to amplify investments, borrowing funds to buy stocks when bullish or borrowing stocks to sell when bearish for profit. As legal restrictions limit margin trading to qualified domestic individuals, its data serves as a key indicator of retail investor sentiment, unlike institutions that primarily use SBL for similar purposes.

In the previous article, we introduced how to build indicators with the margin trading database. This article will be the last one of this series, and we will help the readers become familiar with the Day Trading Statistics database and the Balance of Securities Provided as Financing Collateral database.

In this article, we will show you how to export mutilated data with the “Transfer Data” function. Then, we will apply the data in the Margin Trading database to help users select fundamental indicators.

his chapter, [Margin Trading]will be divided into three parts. The first part will guide readers in a simple and unburdened way to learn how to operate the [Margin Trading] database.