Prediction markets · Pro
Liquidity-based position cap
Also searched as: volume-based position limit
What does Liquidity-based position cap mean?
A liquidity-based position cap limits trade or position size using a market-liquidity measure, such as a share of recent volume. It can apply alongside the program's overall exposure ceiling.
Example
A thin event market allows a smaller position than the account-wide maximum because a separate volume cap applies.
Illustrative example; not a provider’s quoted offer.Why it matters for prop traders
Know the measurement window and whether the cap covers orders, fills or open exposure. Reported historical volume does not guarantee executable depth.
Sources and further reading
The following primary sources support the terminology. Provider rules describe their own products and may change.