In the Funded7 risk management framework, correlated instruments are managed together in groups called “Risk Buckets.”
Rule Definitions #
Rule 2C – Bucket Concentration #
This rule limits the combined risk across instruments within the same Risk Bucket (correlated group). It prevents over-concentration in single market sectors.
- Limit: A violation occurs if the total risk within a single bucket exceeds the account type’s limit.
Rule 2D – Portfolio Concentration #
This rule limits the total combined risk across all open positions in the entire portfolio.
- Limit: A violation occurs if the total risk across all buckets exceeds the account type’s limit.
Risk Limits by Account Type (Common to Rule 2C / 2D) #
| Account Type | Risk Limit |
|---|---|
| Pro (Gold) | 3.0% of seed capital |
| Silver | 2.0% of seed capital |
| Bronze | 1.0% of seed capital |
Calculation Notes:
- Netting: Long and short positions in the same instrument are offset, and only the net risk is calculated.
- Summing: The net risks of all instruments within a single bucket are summed together for the Rule 2C check.
Risk Bucket Classification List #
Forex #
- Bucket 1: USD Long Correlation
EUR/USD, GBP/USD, NZD/USD, AUD/USD - Bucket 2: USD Short Correlation
USD/JPY, USD/CHF, USD/CAD - Bucket 3: EUR Crosses
EUR/GBP, EUR/CHF, EUR/CAD, EUR/AUD, EUR/NZD - Bucket 4: JPY Crosses
GBP/JPY, EUR/JPY, AUD/JPY, CAD/JPY, CHF/JPY, NZD/JPY - Bucket 5: GBP Crosses
GBP/CHF, GBP/CAD, GBP/AUD, GBP/NZD - Bucket 6: Commodity Crosses
AUD/CAD, AUD/NZD, CAD/CHF, NZD/CAD, NZD/CHF, AUD/CHF - Bucket 7: USD Exotics
USDCNH, USDCZK, USDHKD, USDHUF, USDMXN, USDNOK, USDPLN, USDSEK, USDSGD, USDZAR - Bucket 8: EUR Exotics
EURCZK, EURHKD, EURNOK, EURPLN, EURSEK - Bucket 9: Other Exotics
AUDSGD, SGDJPY
Metals & Commodities #
- Bucket 10: Metals
XAU/USD, XAG/USD, XPD/USD, XPT/USD - Bucket 11: Oil & Energy
USOIL, UKOIL - Bucket 12: Natural Gas
NATGAS
Indices #
- Bucket 13: US Large-Cap Indices
US500 (S&P 500), US30 (Dow Jones), US100 (NASDAQ) - Bucket 14: US Small-Cap Indices
US2000 (Russell 2000) - Bucket 15: European Indices
GER40, UK100, FRA40, EU50, ESP35, ITA40, SWI20 - Bucket 16: Asia-Pacific Indices
JPN225, HK50, AUS200
Crypto & Others #
- Bucket 17: Major Crypto
BTCUSD, ETHUSD - Bucket 18: Altcoins
XRPUSD, LTCUSD, SOLUSD, BNBUSD, BCHUSD - Bucket 19: Dollar Index
USDIDX
Examples (Pro Account: 3.0% Limit) #
- Rule 2C Violation (Bucket Concentration):
If you risk 1.6% on EUR/USD and 1.5% on GBP/USD (both in Bucket 1), the total is 3.1%. This exceeds the single bucket limit and results in a violation. - Rule 2D Violation (Portfolio Concentration):
If you risk 2.0% in Bucket 4 and 1.5% in Bucket 10, each bucket is within its 3.0% limit (Rule 2C). However, the total portfolio risk is 3.5%, which exceeds the overall account limit and results in a violation.
