Risk Limits

Risk Limits

Setting user risk limits

To set user risk limits:

  1. In the Settings section, click Apply Limits to enable limit checking for the account or user.

    Optionally, you can determine whether to apply the same limits to block/cross trades and/or synthetic parent orders.

    Note: If Apply Limits is checked, you must define product or contract limits for each product or contract that the user, parent account or child account is allowed to trade.

  2. In the Limits section, click +Add to create a new risk limit, or select an existing limit in the Limits section.

    If you select an existing limit, you can copy product limits within the selected user's or account's limit tab by clicking the Copy button.

    When creating a new risk limit, select the Exchange, Product Type, Product, and/or Contract in the New Limit window and click Add Limit

    Note:If you do not specify a product, then the limit will be the default limit for all products of the selected product type for the selected exchange. If you do not select a contract, the limit will be the default limit for all contracts for the selected product.

    The product limit settings are displayed.

  3. Set the following risk limits as needed:
    • Outrights

    • Note: The following section appears if applying risk limits to a single contract.

      • Trading Allowed: Specifies whether outrights can be traded for the selected contract.
      • Max long position: Limits an account to an overall maximum long position for a product.
      • Max short position: Limits an account to an overall maximum short position for a product.
      • Max order quantity: Specifies a limit on the maximum individual order size that can be entered for the contract. This setting overrides the max order qty setting that might exist at the product or exchange level.
      • Price reasonability: Determines how far from the market price a user may enter an order (in ticks) for the contract. If you only want to enforce this setting for buy orders above the limit and sell orders below the market, check the Aggressive only option. This setting overrides the price reasonability setting that might exist at the product or exchange level.
    • Outrights

    • Note: The following section appears if applying risk limits to all products or all contracts for a single product.

      • Trading Allowed: Specifies whether outrights can be traded for the selected contract.
      • Max order quantity: Specifies a limit on the maximum individual order size that can be entered for the contract. This setting overrides the max order qty setting that might exist at the product or exchange level.
      • Price reasonability: Determines how far from the market price a user may enter an order (in ticks) for the contract. If you only want to enforce this setting for buy orders above the limit and sell orders below the market, check the Aggressive only option. This setting overrides the price reasonability setting that might exist at the product or exchange level.
    • Inter-product Spreads/Strategies

    • Note: The following section appears if applying risk limits to all products or for a single interproduct spread/straegy product:

      • Trading Allowed: Specifies whether spreads and strategies for the product can be traded. If you plan to restrict trading in this product but allow trading for specific contracts for this product, leave this option unchecked.
      • Max order quantity: Specifies a limit on the maximum individual order size that can be entered for the spread/strategy for a particular product, product type, or contract.
      • Applied margin (%): Specifies a percentage above or below the margin that a trader must have to trade the spread/strategy. In other words, applied margin increases or decreases the margin requirement when calculating risk limits. Setting this to zero removes margin requirements for this product/contract.
      • Price reasonability: Determines how far from the market price a user may enter an order (in ticks) for the spread/strategy. If you only want to enforce this setting for buy orders above the limit and sell orders below the market, check the Aggressive only option.
  4. Click Save Changes
  5. To remove a user's or account's product limit, select the limit in the Limits section and click Remove.