# Risk limits for investors

Investors can limit potential losses from their subscriptions by assigning a risk limit to each of their subscriptions.

The risk limit is the maximum loss amount that an investment account can bear from an individual subscription.

## Risk limit calculation

The subscription remains active as long as the combined sum of realized PnL and floating PnL, both of which are calculated based on the positions copied to the investment account from a specific subscription, along with the total amount of fees paid according to the subscription fee plan, does not exceed the risk limit assigned to the subscription.

`(Realized PnL + Floating PnL + Paid fees) <= Risk limit value`

If the risk limit is exceeded, the subscription is automatically terminated as follows:

* All open positions copied to the investment account from the subscription are closed.
* The investor is charged the fees listed in the fee plan specified for the subscription.
* The investment account is unsubscribed from the master account.

**Example**

Suppose an investor assigns a risk limit of $400 to a subscription. At a certain point in time, the trading parameters for the investment account are as follows:

* The realized PnL calculated against the positions copied to the investment account from the subscription is $200.
* The floating PnL calculated against the positions copied to the investment account from this subscription is -$551.
* The total amount of fees paid by the investor according to the subscription fee plan is $50.

`Risk limit = -$400`\
`Realized PnL = $200`\
`Floating PnL = -$551`\
`Paid fees = -$50`

`(200 - 551 - 50) > -400`\
`-401 > -400`

Due to the risk limit being exceeded, the subscription is terminated.

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The risk limit serves as a trigger for the subscription termination process. The actual loss on the investment account may differ from the risk limit amount assigned to the subscription, and it depends on the prices at which the open positions on the investment account were closed.
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**What happens after the subscription is terminated in PAMM**

When a risk limit triggers subscription termination, an unsubscribe withdrawal request is created and queued for the next rollover cycle on the PAMM master account. During rollover, the system settles trading results, charges applicable fees, and processes the withdrawal.

If the master account does not have enough free margin to process the withdrawal, the system automatically partially closes open positions to release the required funds. For details, refer to [Handling insufficient free margin during withdrawal](https://docs.b2copy.b2broker.com/allocation-methods-for-pamm/reallocation-on-deposit-and-withdrawal#handling-insufficient-free-margin-during-withdrawal).
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