Skip to main content
Risk per trade idea (RPTI) is the maximum amount an account can lose across all positions that express the same underlying thesis. It closes a gap left by per-position limits: five individually acceptable trades can still form one oversized bet.

​
Why ticket-level risk is incomplete

A platform displays orders separately. Markets do not always behave separately. Positions may share:
  • the same currency or interest-rate factor;
  • the same equity index or sector;
  • the same macroeconomic release;
  • the same directional exposure;
  • the same strategy signal or entry logic.
If those positions are likely to lose together, summing their nominal ticket limits without grouping them understates concentration.

​
Example

A trader risks 0.4% on each of three positions:
  • long EUR/USD;
  • long GBP/USD;
  • short USD/CHF.
Each trade appears to satisfy a 0.5% per-position cap. All three, however, can benefit from U.S. dollar weakness and lose when the dollar strengthens. The economic idea risk may be close to 1.2%, not 0.4%. Correlation is not constant, and the exact joint loss can differ because of volatility, stop placement, and instrument behavior. The point is to identify shared failure modes before adding exposure.

​
A practical grouping method

1

Name the thesis

Write the market condition required for the position to work.
2

Identify shared drivers

Tag the currency, index, sector, catalyst, direction, and strategy.
3

Estimate loss at invalidation

Use stop-based monetary risk plus a reserve for slippage and gaps.
4

Aggregate related positions

Apply a conservative grouping when dependence is uncertain.
5

Enforce the idea cap

Reduce size, remove a position, or decline the new trade when the group is full.

​
RPTI is not a correlation model

A full portfolio model can estimate covariance and stress scenarios. RPTI is a simpler operating control. It is useful because it can be applied before a trade without pretending that historical correlations will remain stable during stress. Good practice combines both approaches: use quantitative analysis where available, and use clear concentration rules where model precision is unreliable.

​
Questions before adding a position

  • What event or price move would make the existing positions lose together?
  • Does the new order add a new source of return, or repeat an existing one?
  • What is the total stop-based loss for the group?
  • Would the group remain acceptable after a volatility spike or gap?
  • How much daily and maximum-loss capacity would remain?

Correlated risk

Examine why correlations and common factors matter.

One-side betting

Detect repeated directional exposure across an account.

Position sizing

Convert an allowed loss into position size.

EmoGuardian

Review account-level controls, including trade-idea risk.
Risk grouping reduces concentration risk; it does not predict correlation or guarantee that stops will execute at their specified prices.