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Risk Parameters Controlled by Self Directed Futures Traders

Traders, I am interested in your feedback on how you would like to control your trading better.

What risk parameters would you enable to control your trading both strategically and psychologically. What functions would you ask your broker to enable to put yourself in better control?

Please explain why you are asking for these functions.

Thank you,
Matt Z
Optimus Futures

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Thanks for the question, it’s good to pose these types of questions.

For me, I think the fairly typical risk controls are best for me as follows:

  • My most important risk control is a combo of the two bullet-points directly following this. That is, reduce max position size the closer I get to hitting my daily loss limit. This is hard to program in software, but it would be nice. Let’s say my daily loss limit is $1,000 and my max position size is 5 mini contracts (or 50 micro). Once I lose $200 on the day (which is 20% of my daily loss limit), my max position size is similarly reduced by 20% or 1 contract (10 micro). Once I hit $200 loss on the day, my max position size becomes 4 contracts instead of 5. And so on. Of course, this can get hairy when trading both minis and micros or when trading entirely different instruments. I will trade both ES/MES but not two completely different instruments on the same day. The purpose of this risk control is to prevent me from hitting my daily loss limit by reducing the number of contracts I can trade at one time. It becomes harder for a bad day to turn into a worse day.

  • Daily loss limit (“DLL”) in terms of dollars (or percent of day’s starting acct balance, like 5%) that I can adjust myself, but also have set at the IB/FCM. That is, have the IB set a daily loss limit of say $1,000. But allow me to set my own to any amount under $1,000 (e.g., $500). This would allow me to adjust my DLL based on how I feel, how I’ve been performing, how realized vol is changing, or whatever. But I would always have the DLL set at the IB that I can’t change unless I call you or write an email. And of course, the FCM could have its own loss limits, as well, whether it be daily or min acct equity.

  • Max number of open contracts and max number of pending orders. I think max pending orders should always be exactly double the max position size to allow for OCOs. Similar to the above, there would be a limit set by the IB or FCM based on margin requirements. But I would like to be able to set my own max position size at some number under the max set at the IB/FCM so that, again, I can reign myself in when I’m doing poorly and open up the gates when I am doing well—up to the max set at IB/FCM. This should be allowed on a per-instrument basis.

  • Disable trading and auto liquidate if account equity drops below a specified level. Instead of a daily loss amount, this is based on account equity. Again, have one level set at the IB and one that is end-user controllable. If trading is disabled, then end-user must contact that IB to get it re-enabled.

All except for the first item, these appear to be built into R Trader and R Trader Pro.

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This is the exact type of feedback I was looking for.
Maybe others will provide their input as well.

Matt Z
Optimus Futures

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Refreshing to hear you are looking for feedback on this crucial topic. I believe that broker side risk management & lock control is what is really needed and from what I’ve read on Tradeovate feature requests and other forums there are many more who feel the same.

Meaning the trader needs to be able to tell the broker “I want my max daily loss set to X $'s from 9AM 7/9/22 till 6PM 7/19/22. I want this locked so that no matter what it cannot be changed until 7/19/22. I don’t care if I call screaming DONT CHANGE IT.”

Tradeovate and other platforms have risk control parameters but they can be changed. Tradeovate has a locking feature where if you reach your max daily loss or some other parameter it will lock till the next day. That is a step in the right direction but we are all human and emotions can still get the best of us. It’s very easy to say put a $500 max daily loss and set it to lock if hit but then your last trade got your account to -$475 and you know your about to be locked out if you take another looser so your extremely tempted to just go bump up the max loss to $750.

This temptation has to be removed completely and control must be given only to our clear headed ‘pre-market trader’ and fully taken away from our emotional ‘my goodness i’m down too much trader’

Seems the only way to get this in futures / equities today is to join a prop firm who has a dedicated risk manager who will in no way let you surpass set max loss limits of the firm.

If Optimus employed this type of service I really think a ton of traders would come your way. It could really be a USP (unique selling point) for you. An edge that no one else has. You can say “Now you don’t need to be in a prop firm to have true outside yourself managed risk control, just tell us what you want to risk and we will make sure you never exceed that”. A way to beat AMP even with higher commissions :slight_smile:

I’ve been trading many years with AMP and Tradeovate and would gladly switch to any broker who would offer this because I know myself too well.

Hope you will consider,


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Hi @Zeckrin Thank you for your feedback, and we look forward to hearing from you in the future. We seek the input of our traders because we believe that risk management is critical to the success of their careers as day traders.

It seems that what you seek is to be set up by the broker and not by the trader. That way, you do not have a chance to break the rules as you indicated. We can do that:

  1. Optimus Futures can set a specific number of lots
  2. Optimus Futures can set a daily loss for your account
  3. We can set a daily liquidation set at a specific hour
  4. We can set a daily % loss of your equity.

Just a reminder that these are not exchange-traded rules, and they reside on servers of the trading API. Therefore, we always suggest watching your trading screen to see if it was executed.

There are even other features we can have, however, if you send a request one day to cancel these features, we must do so. Trading circumstances can change, and we must respect that.
Therefore, the discipline you dictate has to be followed by you as well.

Try our Futures Trading Platform
See if you like it, and then we can build your idea of your own risk management.

We did add a few risk management alerts such as $ Target, and $ Loss.
Other tools we have added that are discipline-related where you dictate the time you are in a trade, and allow you to trade when your method is complete (so only when the time bar closes).
We thought that would help traders.

Again, I appreciate the feedback, and we are definitely going to add additional features to that platform that are based on your feedback and others.

Matt Z
Optimus Futures

There is a substantial risk of loss in futures trading. Past performance is not indicative of future results.