Investors can cap potential losses by assigning a risk limit to each subscription — the maximum loss the investment account is willing to bear from that individual subscription.
How the limit is calculated
The subscription stays active while the combined realized PnL, floating PnL, and paid fees (all measured against positions copied from that subscription) have not breached the limit:
Realized PnL + Floating PnL + Paid fees ≤ Risk limitWhat happens when it is exceeded
- All open positions copied from the subscription are closed.
- The investor is charged the fees in the subscription’s fee plan.
- The investment account is unsubscribed from the master account.
Worked example
An investor assigns a 400 USD risk limit. At one point the subscription stands at:
| Component | Value |
|---|---|
| Risk limit | −$400 |
| Realized PnL | +$200 |
| Floating PnL | −$551 |
| Paid fees | −$50 |
| Combined result | −$401 |
The combined result of −$401 is a larger loss than the −$400 limit, so the subscription is terminated.
The limit is a trigger, not the exact loss
The actual loss may differ from the assigned limit — it depends on the prices at which the open positions are closed.
In PAMM
A breached limit queues an unsubscribe withdrawal for the next rollover. If the master lacks free margin, positions are partially closed to release funds — see Reallocation on deposit and withdrawal → Handling insufficient free margin.
