Risk as a system property, not a checkpoint
The most expensive risk failures happen when controls live outside the trading loop. We encode them inside it.
It is tempting to treat risk management as a report produced at the end of the day. By then, the decisions that matter have already been made.
We take a different view. Position, exposure and concentration limits are validated before an order ever reaches a venue, and intraday P&L, value-at-risk and limit utilisation are monitored continuously. The controls are part of the system that trades, not a layer that reviews it afterwards.
Independence matters
Encoding controls in software is necessary but not sufficient. Risk operates independently of the desk, with clear escalation paths and documented governance, so that the people setting limits are never the people incentivised to breach them.
Designed to hold under stress
Scenario analysis and stress testing quantify tail exposure across correlated power positions in multiple markets. The goal is simple: when markets move violently — and in energy, they do — the firm behaves exactly as designed.