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Set up limits

Limits is a tool that allows you to setup and monitor post-trade limits, or different investment constraints, on your portfolios. For example, Limits provides you tools for monitoring UCITS limits, different compliance limits or allocation limits - Limits provides you with a flexible tool to setup and monitor even complex investment limits.

Follow the steps below for an overview of setting up limits and limit monitoring.

Step 1 - Set up limit definitions

First, set up your global limit definitions, or the individual investment constraints you want to follow on your portfolios. Limit definitions allows you to flexibly set up the constraints you want to follow, and easily define thresholds for warnings and breaches.

You can set up your global limit definitions under Preferences. For more information, see Limit definitions). Setting up limit definitions consists of two steps:

  1. Set up a limit group through the Add group button. This allows you to set up a "container" for individual limit definitions, allowing you to manage similar limits together as a group. Limit group can for example be "UCITS limits", "Allocation limits" or similar.

  2. Set up individual limit definitions under your limit group through Add new limit definition button. This allows you to set up the individual limits / constraints / checks you want to analyze for your portfolios. You can set up limit definitions as "relative values" or "absolute values":

    • For relative values, define the limit in terms of Value(s) to compare and Summed value to compare against - essentially, you define which value you want to compare against what other value, for example "total market value of stocks" (defined on the left) compared to "total market value of the portfolio" (defined on the right). At the end, define the minimum and/or maximum warning and breach thresholds with a numeric value between 0 and 1 - relative values are always analyzed as percentages, which is defined as decimal (e.g. 10% breach level defined as 0,1).

    • For absolute values, only define the Value(s) to compare - define the value you want to monitor. At the end, define the minimum and/or maximum warning and breach thresholds.


Step 3 - Analyze your portfolios' limits

Third, after you have linked limits to your portfolios (or decided which portfolio should follow which limits), the next step is to analyze the limits. You can analyze limits on one portfolio, or you can mass-analyze limits on multiple portfolios at once.

  • Analyze all limits button in the Portfolio window allows you to analyze limits linked to your portfolio on all levels at the same time. Alternatively, you can analyze limits only on a specific level.

  • Alternatively, Analyze all limits button in the Portfolios view allows you to analyze limits linked to multiple portfolios on all levels at the same time. Alternatively, you can analyze limits only on a specific level.

Analyzing limits compares your portfolio's current contents against the limit definitions you have linked to your portfolio. Limit analysis provides you with a detailed analysis on which individual limits are OK, which induce a warning, and which limits have been breached on different levels. You are also presented with more details on the analysis in terms of which individual components within your limit definition affected the overall result of your limit.


Step 4 - Extend limits with monitoring

Finally, in addition to being able to analyze and monitor your limits on each portfolio, you can extend your limits with more extensive limit monitoring.

  • You can build limit monitoring dashboards with queries to show aggregate information from all your portfolios' limits - you can for example gather an overview on limit statuses, warnings and breaches from all your portfolios.

  • Automatic limit analysis and monitoring allows you to analyze certain limit groups automatically in the background, and receive automatic notifications on warnings or breaches.

If you are interested in these extensions to limit monitoring, contact FA for more details.