Practice Note 4.6.7A(3) — Firm-Level Monitoring of Capital and Financial Requirements and Prudential Limits
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1.1 This Practice Note explains the requirement for monitoring potential breaches of capital and financial requirements and prudential limits on exposures to a single customer and a single security set out in Rule 4.6.7A(3).
2. Firm-Level Monitoring of Capital Requirements and Prudential Limits
2.1 In an electronic trading environment where orders are processed and routed at speed, Trading Members should use appropriate measures to monitor if the firm is at risk of breaching its capital or financial requirements or any prudential limits, for example:—
(a) setting automated filters on firm-wide aggregated exposures;
(b) having processes to generate warnings; or
(c) having processes to route large value orders for review.