Risk Caps Before Live Mode: A NOVA Guide for Prediction-Market Operators
Why NOVA requires explicit risk caps before live prediction-market automation.
Risk caps belong before live mode.
That sounds obvious, but many automation setups treat sizing as something to tune after the bot is running. NOVA takes the opposite view. The maximum allowed exposure should be written down before the system can submit real orders.
A cap is a decision, not a slider
The operator should understand what the cap means in plain terms. If the cap is 2 percent, 2 percent of what? Per trade, per window, per day, or per account?
The answer should be explicit. A vague cap creates false comfort.
Caps should match the market window
BTC 15-minute markets have a short decision cycle. That means repeated small mistakes can stack quickly if the cap is too loose.
The cap should account for the number of windows the system can see, the maximum size per window, and the conditions that stop the system from continuing.
Live mode should inherit the no-submit result
If no-submit mode previews an intended size, live mode should not suddenly use a larger one. Changes to sizing should require a fresh review.
This gives the operator a clean chain: signal, preview, approved cap, live action.
Stop conditions matter
A cap limits size. Stop conditions limit behavior.
NOVA should stand down when required data is missing, the market mapping is unclear, the signal is stale, credentials fail, payment is not verified, or the operator has not approved live mode.
The operator takeaway
Risk caps are not decoration. They are the boundary that makes guarded automation possible. NOVA should make that boundary clear before the first live order is allowed.