Prop Firm Management

Pre-Trade Risk

As mentioned in the Setup section, Pre-Trade Risk is evaluated before a trade is executed. This means that an account monitored by a pre-trade risk setting won’t even be able to enter a position if the order being placed is rejected.

Types of Pre-Trade Risk

The primary ways that pre-trade risk is defined is through the following system risk components:

  • RiskCategory - a configuration for pre-trade risk rules such as lot limits and restricted products. An evaluation support representative must create these for you, however you will be able to review them via dashboards once created.
  • AutoLiqProfile - a configuration for margin based liquidation and EOD behavior. This is tightly tied to the next entity, RiskTimePeriod. This must be created by an evaluation support representative.
  • RiskTimePeriod - a configuration for time-based liquidation. This must be created by an evaluation support representative, but then can be edited by a Partner. You can utilize this entity to prevent overnight holding, and to manage special holiday hours.

Risk Categories

These are typically defined by your Template Account and applied at creation. However, you can adjust risk categories after the account is created. An Evaluation Support representative is needed to make direct adjustments to your risk categories, so be sure to notify a team member if you need to make a change.

Setting Initial Category

Leverage your Template Accounts. When you create an account using a templateAccountId, it will inherit pre-trade risk settings such as RiskCategory.

Switching Risk Categories

During the lifecycle of an account, you may find a reason to switch it’s risk category. If you have multiple categories defined, you can “switch” an account’s (or group of accounts’) risk category using the accountRiskStatus/switchRiskCategory endpoint with the following JSON request body:

1{
2  "accountIds": [12345, 67890],
3  "riskCategoryId": 789
4}
  • accountIds - this is an array of IDs of accounts that will be switched.
  • riskCategoryId - the ID of the riskCategory that accounts will be switched to.

AutoLiqProfile

The AutoLiqProfile entity will be defined by an Evaluation Support representative. This particular entity is not editable by your partner organization. The configuration of this entity allows for margin-related liquidation rules. This includes overnight margin, which is how we allow vendors to restrict users from opening positions during market close. This is tightly coupled with RiskTimePeriod, which is the entity your partner organization will use to manage auto-liquidation of accounts holding positions at close.

RiskTimePeriod

This entity controls time-based liquidation. There are two components of RiskTimePeriod:

  • startTime - the time at which the time-based liquidation rules turn on; this is the time at which accounts will be liquidated if they are holding positions.
  • stopTime - the time at which the time-based liquidation rules turn off. Users will be able to place trades again from this time on until the next startTime.

There are two main reasons that a partner would want to use RiskTimePeriods.

  1. To prevent overnight holding. Users will be liquidated at startTime.
  2. To manage holiday hours; startTime can be manually adjusted ahead of the holiday to prevent users from holding over.

You can use the Admin Dashboards to modify this entity, meaning your support team can manage operations for holidays.