This policy defines High-Risk Instruments as including, but not limited to, precious metals (such as XAUUSD), cryptocurrencies, equity indices, energy products, and any instrument identified by Kudo Funded as subject to high volatility or reduced liquidity.
Traders are required to ensure exposure to High-Risk Instruments adheres to the following limits:
1. Single-Instrument Exposure (High-Risk Instruments)
The total notional exposure to any single High-Risk Instrument must remain under 25% of the Account balance or equity, whichever is lower.
2. Margin Utilisation Alignment
Following Kudo Funded’s margin usage guidelines, the margin allocated to any single High-Risk Instrument must not exceed 5% of the Account’s available margin at any given time.
Key Clarifications:
- These limits apply to each individual instrument.
- The combined margin utilization across all positions must remain below 10%.
- Violating either limit constitutes a breach of the rule.
3. Asset-Class Concentration
The overall exposure across all High-Risk Instruments must not surpass:
- 40% of total notional exposure, and
- 60% of total margin utilization for the Account at the relevant time.
4. Directional Concentration
Exposure in a single market direction, whether long or short, across all High-Risk Instruments must not exceed 50% of the Account’s overall notional exposure, regardless of:
- Number of positions,
- Hedging strategies employed,
- Placement of stop-loss orders.
5. Position Accumulation and Scaling
Opening multiple positions in the same High-Risk Instrument—in any manner that results in exceeding thresholds outlined above—will be classified as excessive exposure concentration. This applies regardless of:
- Trade size,
- Execution speed,
- Holding duration,
- Profitability of trades.
Enforcement and Assessment
Exposure and margin utilization are monitored collectively and continuously across all active positions, pending orders, and partially hedged or offsetting trades.
Any violation of these limits will be considered a breach of Kudo Funded’s risk management regulations, irrespective of:
- Usage of stop-loss mechanisms,
- Trader’s intent or expertise level,
- Market fluctuations,
- Position profitability or losses.
Kudo Funded retains the absolute right to take any corrective action deemed necessary, including but not limited to adjusting or liquidating positions, voiding trades, revoking profits from affected positions, restricting trading activity, or terminating the Account without prior notice.
Interpretation and Non-Waiver
- Kudo Funded’s risk systems will mechanically and objectively evaluate exposure concentration and margin utilization; these determinations are deemed final and not subject to dispute.
- Any failure by Kudo Funded to enforce this policy at a specific time does not waive its right to implement it at any subsequent point.