Risk Management

Core Principles

Risk Limits

Per-Trade Risk:

• Default: 0.5-2.0% of capital per trade
• Maximum: 2.5% per trade (hard limit)

Portfolio Heat:

• Maximum: 2.0% of capital at risk simultaneously
• Monitors aggregate exposure across all positions

Daily Loss Limit:

• Hard stop: -2.5% of capital
• Triggers automatic position flattening