Driven by factors such as the warming up of the conflict between Russia and Ukraine and the exclusion of Russia from swift by Europe and the United States, the global financial market fluctuated sharply and the capital risk appetite was significantly impacted. In particular, the Russian ruble exchange rate fell by an astonishing 30% in one day, causing financial institutions to strengthen transaction risk control - foreign exchange trading institutions have reminded customers to pay close attention to market dynamics, and even some foreign exchange institutions have suspended ruble opening transactions. On March 1, global asset prices stabilized, the exchange rates of the US dollar and the RMB decreased slightly, and risky assets such as stocks rebounded generally during the Asian trading session. Many insiders pointed out that with the international geopolitical situation becoming more unstable, the global economy, politics and even the industrial chain pattern may face a series of reshuffles in the future. How to seek advantages and avoid disadvantages, investors need to observe carefully and strictly control trading risks. It is worth mentioning that the gold market, which is more sensitive to geopolitics, is favored by funds because of its risk aversion attribute. Investment targets including gold related stocks, gold ETFs and gold futures have received capital inflows, and all parties in the market are generally optimistic about the development of the subsequent market. Market volatility Strengthen transaction risk control After the mood cooled, the market is stabilizing. On March 1, the ruble exchange rate corrected on the basis of the sharp decline of the previous day, and the quotation of the US dollar against the ruble was 105.08. Previously, on February 28, the ruble once fell to 119.25 rubles to the US dollar, a record low, down nearly 30%. Statistics show that since this year, the Russian ruble exchange rate has fallen by more than 40%. In the fierce fluctuations of the market, foreign exchange trading institutions have taken countermeasures. The reporter of the securities times learned from Jiasheng, a global online foreign exchange dealer, that Jiasheng has suspended the opening trading of this variety in view of the recent intensification of the volatility of ruble foreign exchange futures. The agency also warned that many other markets may also fluctuate, and corn and wheat are limited to telephone trading. Trading during the period of drastic market fluctuations has high risks and is not suitable for all investors. The relevant person in charge of Nanhua futures said that the recent foreign exchange fluctuations had a certain impact on the business of Henghua International (Nanhua futures Hong Kong subsidiary), but the overall risk was controllable. Henghua International also actively pays attention to recent risk factors, closely tracks market dynamics and strengthens customer transaction risk control. Looking back on history, Russia's ruble exchange rate has been maintained at 30 rubles to 1 US dollar for a long time. Then in 2014, Russia was sanctioned by the West because of the Crimea problem and suffered a sharp drop in oil prices, resulting in a sharp drop in the ruble. From July 2014 to January 2015, the ruble fell by 48% and the exchange rate fell to the first line of 70. Recently, with the increase of Western sanctions, the depreciation of the ruble exchange rate has been further enlarged. On February 27, the United States added sanctions including swift ban and restrictions on the deployment of foreign reserves by the Russian central bank, which aroused market concerns. A day later, risk aversion cooled on March 1. Based on the sharp rise in the previous days, the US dollar index retreated below the 97 integer mark, and the RMB exchange rate also returned to 6.31. Previously, the RMB exchange rate broke through 6.32 and 6.31 in a row, rising to 6.3025 on February 28, a new high since April 2018. On the same day, during the Asian trading session of the global stock market, risky assets generally rebounded. Among them, the A-share Shanghai stock index closed up 0.77%, the Nikkei 225 index closed up 1.2%, and European and American stock index futures also generally rose. The previous trading day, driven by risk aversion, there was a certain degree of correction in global stock markets such as Europe and the United States, and the volatility index VIX of the S & P 500 index soared again, and bonds regained favor. Li Chao, chief economist of Zheshang securities, believes that at present, there is no need for the risk of further escalation of the pricing war for large categories of global assets. For example, if the risk risk really occurs, the Ukrainian crisis rises to a positive conflict between the United States and Russia, and large categories of assets will turn to gold, crude oil, military industry and money market funds. Obviously, as the international geopolitical situation becomes more unstable, the global economy, politics and even the industrial chain pattern may face a series of reshuffles in the future. How to seek advantages and avoid disadvantages, investors need to observe carefully and strictly control trading risks. The hedge premium has appeared Gold prices are still bullish in the medium and long term For the geopolitically sensitive gold market, it is favored by funds because of its risk aversion attribute. Investment targets including gold related stocks, gold ETFs and gold futures receive capital inflows. Previously, on February 24, the international gold price once rose to US $1975.7, up US $65 on the same day. By March 1, the international gold price remained around us $1900 / ounce. In February, the international gold price rose by 5.8%, the largest monthly increase since May 2021. "Gold prices tend to remain high for a few months after the incident." Juan Carlos Artigas, head of global research at the World Gold Council (WGC), said that historical data showed that in the tail events related to major geopolitical crises, gold was often able to respond positively. Although prices fluctuated, gold prices tended to remain high for several months after the event. In addition, gold has a highly liquid market with a deep foundation, with an average daily trading volume of more than $120 billion and a small bid ask spread. All these characteristics, coupled with the absence of credit risk in gold bars, make gold a popular safe haven asset. According to the statistics of the World Gold Council, the global central banks have increased their holdings of gold by more than 4500 tons in the last 10 years. As of September 2021, the total holdings have increased by 15% over 10 years ago, reaching about 36000 tons, the highest level in 31 years. In contrast to the continuous improvement of gold reserves, the sense of existence of the US dollar is declining. Among the foreign exchange reserves of global currencies, the proportion of the US dollar has fallen to the lowest level in 25 years and fell below 60% for the first time. Specifically, Russia has sold and reduced US debt substantially since the beginning of 2018. According to the US Treasury Department, the proportion of Russian investors holding US Treasury bonds also decreased from a high of 4.2% in 2009 to 0.1% at the end of 2021. The proportion of gold in the foreign exchange reserves of the Russian central bank has increased to 22%. Zhou Tuo, chief researcher of Ping An futures, said that under the resonance of anti inflation and risk avoidance, the price of gold will continue to run stronger. The uncertainty of the conflict between Russia and Ukraine continues, and the tension between Russia and Ukraine strengthens inflation expectations through energy prices, boosting gold prices. In addition, political factors such as the US mid-term election and the Iranian nuclear agreement will also support the price of gold. "Gold prices are bullish in the medium and long term." Xu Ying, a senior foreign exchange analyst at the east securities derivatives research institute, believes that the hedging premium has begun to appear in the gold pricing, and the subsequent impact of the Russian Ukrainian issue on the gold price is closely related to whether there are more events than expected. In the medium and long term, even if the geopolitical pulse trading is ended in the gold market, it will further boost the gold price due to the medium and long-term stagflation risk of economic fundamentals. (Xinhua News Agency)