PFSOFT has just released a new functionality for CFD brokers who use b-book execution called Price Limits. These limits are specially developed to reduce market risks during large price movements as well as to avoid panic buying and selling. Brokers, who act as a principal to their clients, will benefit from this functionality that allows setting up max price change during the trading day. Brokers can either reflect limits directly from the exchange, or set up lower values based on their risk management, and thereby to reduce their losses.
Similar to the stock and futures markets, these limits allow brokers to decline all the new orders outside of these limits automatically. At the same time, there is no trading halt, and if the clients want to close their positions – it will be done.
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