# Risk Management #### Risk is embedded, not appended UNIKO’s risk philosophy is that risk controls must be integrated into the operating structure: · All strategies operate under predefined exposure boundaries. · Execution paths and scaling operate under governance rules. · Monitoring detects deterioration during operation, not only after losses. #### Risk control domains **Position and exposure control** Controls may include: · Max position size per asset · Max inventory skew (deviation from target inventory) · Max concentration per venue · Max notional per execution window **Liquidity risk control** Controls may include: · Slippage caps per trade · Price impact estimates (DEX) · Depth-aware sizing on CEX order books · Illiquidity detection triggers for throttle/pause **Execution risk control** Controls may include: · Failure rate detection · Order rejection thresholds · Latency spike detection · Partial fill deterioration rules **System-level protection** Controls may include: · Kill-switch triggers · Automatic throttling based on drawdown · Venue health gates · Data integrity halts #### Stress scenario response playbooks **Scenario: sudden volatility spike** · Observed risk: adverse selection increases; slippage widens; fills degrade · System response: widen quoting bands; reduce size; increase spread thresholds; throttle execution **Scenario: venue degradation (CEX)** · Observed risk: reject rates rise; latency spikes; order book becomes unstable · System response: switch venues; reduce order rate; cancel open orders; pause venue if needed **Scenario: DEX liquidity drop** · Observed risk: pool imbalance increases; price impact becomes steep · System response: reduce swap size; pause swaps; route via alternative pools; rely on CEX execution until depth returns **Scenario: data feed integrity issues** · Observed risk: stale or inconsistent market data causes unsafe execution decisions · System response: halt execution; failover data feed; require health checks before resuming #### Circuit breakers (illustrative examples) These are illustrative only and should be published as final parameters only after production validation.


Circuit breaker	Illustrative trigger	Illustrative response
Slippage guard	Slippage > S% repeatedly within window	Reduce size; reroute; pause pair
Failure burst	> N rejects/failures in M minutes	Cancel orders; halt execution; alert
Inventory skew cap	Inventory deviation > I%	Rebalance; reduce one-sided quoting
Drawdown throttle	Rolling PnL < -D threshold	Reduce risk; move to defensive mode
Data integrity halt	Feed stale beyond T seconds	Pause; failover; alert

Illustrative parameter ranges (non-binding)


Parameter	Illustrative range
Slippage cap (stable markets)	0.10%–0.30%
Slippage cap (volatile markets)	0.30%–0.80%
Inventory deviation cap	5%–25% of target
Failure burst threshold	3–30 failures in 1–10 minutes
Drawdown throttle trigger	1%–10% rolling drawdown

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