operational-risk
Operational Risk
Purpose
Guide the identification, measurement, and management of operational risk in securities trading and brokerage operations. Covers trade error handling, settlement fail management, loss event classification, key risk indicators (KRIs), incident management processes, business continuity planning, and operational risk frameworks. Enables building or evaluating operational risk programs that reduce losses and satisfy regulatory expectations.
Layer
11 — Trading Operations (Order Lifecycle & Execution)
Direction
both
When to Use
- Building or evaluating an operational risk framework for a trading desk, broker-dealer, or investment adviser
- Designing trade error detection, correction, and escalation procedures
- Investigating trade breaks and establishing reconciliation workflows
- Classifying loss events under Basel or internal taxonomy for reporting and trend analysis
- Developing or refining key risk indicators (KRIs) and dashboards for trading operations
- Responding to operational incidents (system outages, data feed failures, order routing errors)
- Conducting root cause analysis after a trade error, settlement fail, or system incident
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