Understanding What a Daily Notional Limit Controls for a Trading Agent
Learn how a daily notional limit shapes order size, risk exposure, and compliance for automated trading agents, and what uncertainties remain.
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- 01The daily notional limit caps the aggregate dollar value of all orders an agent can place within a 24‑hour period.
- 02It is enforced by the agent’s scoped key, separate from withdrawal authority, so the limit cannot be bypassed by a trade‑scoped key.
- 03The limit reduces exposure to large‑scale market moves but does not guarantee that individual orders will be filled at expected prices.
- 04If the limit is reached, further order attempts are rejected, and the agent must wait until the next reset period.
- 05Owners must monitor limit usage and may need to adjust limits or re‑authorize the agent as market conditions evolve.
A daily notional limit defines the maximum total trade value an automated agent may submit in a single day. It is a policy field that the owner signs into the agent’s scoped key, and it applies to every order the agent attempts to place until the limit resets. For related context, see When Should a Trading Agent Use a Market Order vs a Limit Order?.
Why Use a Daily Notional Limit?
The primary purpose of a daily notional limit is risk containment. By capping the aggregate exposure, owners can prevent an agent from unintentionally exhausting capital during volatile periods or due to a logic error. This control works alongside other limits such as order size and daily loss caps, forming a layered safety net.
How Does the Limit Get Enforced?
When an agent key is created, the owner includes a signed daily notional field. The runtime checks each order against the remaining allowance. If the order would push the day’s total above the limit, the order is rejected before it reaches the venue. The enforcement is independent of withdrawal permissions; a separate owner‑signed intent is required to move funds out of the account.
What Happens When the Limit Is Hit?
Once the daily notional budget is exhausted, any further order attempts return an explicit error indicating the limit breach. The agent can continue to run, but it must either wait for the next daily reset or request a limit adjustment from the owner. The limit does not automatically close existing positions, and an emergency stop would need to be invoked separately.
When Might a Daily Notional Limit Not Protect an Agent?
The limit only governs the sum of order notional values, not the price at which those orders fill. In fast markets, an order may slip to a worse price, increasing actual loss beyond what the notional sum suggests. Additionally, a timeout does not prove an order failed; the system must reconcile the order status to confirm execution.
How to Monitor and Adjust Limits Effectively?
Owners should regularly query runtime status and account state to track limit consumption. If the agent consistently approaches the limit, the owner may raise the ceiling or refine the agent’s strategy. Conversely, if the limit is rarely used, a lower setting can tighten risk controls without hindering performance.
- Review daily notional usage via the runtime status endpoint.
- Set alerts for when usage exceeds a chosen percentage of the limit.
- Adjust the signed limit only after reviewing recent trade outcomes.
- Combine daily notional limits with loss caps for comprehensive risk management.
A daily notional limit is a policy tool, not a guarantee of safety; it reduces exposure but cannot eliminate market or execution risk.
Frequently asked questions
An order‑size limit caps the value of any single order, while a daily notional limit caps the cumulative value of all orders within a 24‑hour window.
Yes, the owner can issue a new signed limit, but the change takes effect only after the updated key is applied to the agent.
No, the limit only stops new orders. Existing positions remain open until the owner takes separate action, such as an emergency stop or manual trade.
An emergency stop revokes the calling key and cancels managed activity where possible, but it does not automatically reset the daily notional counter.
See the guide on [Daily Notional Limits: How They Protect a Trading Agent](/blog/daily-notional-limit-guide) and the broader discussion in [Understanding Daily Notional Limits for Trading Agents](/blog/understanding-daily-notional-limits-for-trading-agents).
Sources and verification
Product claims in this article were checked against these first-party references. Runtime status remains authoritative for current availability.
- Felix documentationfirst party
- Felix machine referencefirst party
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