Trust & regulatory
The controls, line by line.
For diligence teams: every check an order meets, every protection that acts on its own, every record kept, and what the system does not do.
First, the staged risk check passes, before an order is created. Second, at submission, the account’s policy has trading switched on. Third, at submission, the entry halt is off, or the order only reduces risk. Exits always pass
Control reference
Three locks before the broker.
First
The staged risk check, before an order exists.
Each equity entry passes a fixed sequence of checks before an order is created. A failure at a critical stage stops the order there.
An open that would breach the exposure cap is refused. An order that reduces risk is never blocked by it. If the book cannot be measured, the open is blocked.
At submission the engine also checks exchange halts, the short-sale uptick rule, good-faith rules and market hours. It refuses an entry whose stated invalidation price is already breached.
Sector concentration is measured and recorded as a warning; it does not refuse an order. Crypto and options orders run their own risk checks, then meet the second and third locks at submission like every other order.
The stages, in the order the engine runs them:
- System circuit breaker
- Account state
- Number of open positions
- Single-name concentration, against the account’s cap
- Leverage
- The policy’s gross and net exposure caps
- Margin use
- Pattern-day-trader rules
- Daily loss and drawdown limits
- Buying power
Second
At submission, the account must be switched on.
Each account’s trading policy has a trading switch. The engine sends orders only when it is on. A missing or unreadable policy counts as off.
Before an account can send orders to a broker, it needs a second, independent grant: its id must also be on the engine’s deployment list. The two live in different systems, so no single database edit can make an account tradeable.
- Applies to every order client the engine hands out, in every asset class.
- A switched-off account is neither traded nor managed. Stops already resting at the broker stay in force.
- Every refusal is counted and logged. An account never leaves a path silently.
Third
At submission, the entry halt stops entries, not exits.
Suspending trading on an account engages its entry halt. From that moment nothing that could open or add to a position is sent. Cancels, closes and protective stops still go through.
Any other order passes only when a fresh read of the account’s positions proves it reduces one. If the switch itself cannot be read, it is treated as engaged.
- In Adaptic OS the switch sits on the account’s trading policy, under Autonomy, in the card “Entry halt”: “Suspend trading”.
- The screen states what it does: “New entries stop. Existing positions, exit management and protective stops keep running.”
- It takes effect within a minute, when the engine next reads the policy.
Protections that act on their own.
A control that waits for a person is slower than the market it guards against. These act on their own, on every market day.
- New entries halt on daily-loss, drawdown, rapid-loss, consecutive-loss, broker-error, data-quality and market-dislocation events. Exits still pass.
- Positions are reconciled against the broker every five minutes in market hours. A mismatch pauses new entries.
- Volatility and dislocation breakers can close every open position.
- Trailing stops protect each position.
- Equity books are flattened from 15:55 New York time every market day.
- If the model is unavailable, the engine stands aside. It does not trade on a fallback.
Every record, and what it holds.
The engine and Adaptic OS keep separate records for separate decisions. Each one answers who, what, when and why for its own kind of event.
For human judgments and setting changes, the software has no path that edits or deletes an entry. A correction is a new entry, and the original stays beside it.
- Pre-trade verdicts
- For each order checked: allow, resize, reject or escalate, the stage that decided, and what each stage measured.
- Control verdicts
- For each governed control: its verdict, and whether it was acting or running in shadow.
- Order lineage
- For each order: the model and prompt version behind it, and the invalidation price it stated.
- Trade records
- Entries, exits and the reason for each, refused entries, sizing decisions and outcomes. An outcome that was not measured is stored as unknown, never as zero.
- Risk states
- Every move of an account between normal, warn, throttle, paused, flatten and halt, with the reason and the actor.
- Human judgments
- Every approve, reject or escalate on a governance item, with its written rationale and, where required, a second signature.
- Setting changes
- For each change to an engine setting: the prior value, the new value, a written rationale and the approver.
- Trading-switch changes
- Who changed an account’s trading switches, from where, with what stated reason, the values before and after, and the outcome.
- Mandate approvals
- Who proposed a mandate version, who approved or rejected it, and why. The proposer cannot approve.
- Data changes
- Every change made through the data service: actor, time, operation and fields changed, with credentials redacted.
What the system does not do.
- It does not hold an order for human approval. No order waits for a sign-off; an account is traded within its policy, or not traded.
- It does not enforce every field a trading policy can store. Adaptic OS names, on the policy screen itself, the fields the engine does not read.
- It cannot move money. There are no payment rails, wires or transfers.
- It cannot strike NAV. Adaptic OS previews a NAV strike; it cannot commit one.
- It does not take hand-placed orders. Order entry in Adaptic OS is switched off.
- It does not screen sanctions automatically.
- It does not open a position without a stated invalidation price.
- It does not wait for a person before cutting risk.
| Decision ledger | Every check, change and judgment is recorded with who or what made it and why, and any trade can be traced from signal to outcome. |
|---|---|
| Technical briefing | The technical briefing walks through each control with the people who built it. |
| Trust & regulatory | For regulators, government bodies and diligence teams: our regulatory posture, the controls that decide what the system may do, and the record an examiner reads. |