Zolio Trading Rules: Tudor Summer Interns 2016
Securities
Limited to Common Stocks and ETFs*
Market capitalization of $100 million and above**
Both long and short positions allowed
Cash may be held
Pricing Information
Level 1 pricing information only
Exchanges
BATS
Types of Orders
Market Orders
Limit Orders
Stop Orders
Account Size
$1,000,000 (Fictitious)
Strategy Style
No limitations
Minimum Number of Equity/ETF Positions
Participants must purchase at least 10 discrete equity/ETF positions during the Session.
Trading System
Participants are required to manually enter trades into the online trading system
Participants may not modify the trading system, may not integrate software with the trading system, and must use the system “as is”.
Minimum Size of Any Single Trade
USD $5,000 (Fictitious)
Maximum Number of Trades
Interns may enter up to 20 trades in the first week in order to establish their portfolios; thereafter, only 10 trades per week will be allowed.
Transaction Fees
Equities: USD $0.045 per share (Fictitious)
Financing (Cost to short)
300 basis points per annum of the total order (Fictitious)
Limits on Shorting
The Short Book or the Long Book cannot exceed 5x capital, thus any trade that creates that situation will be rejected. If your account has $1 million, for instance, you cannot be short more than $5 million in equities in total.
Buying Power
Buying power is equal to Initial Capital + Total Cash Inflows/Outflows – Commissions – Borrow Cost + Realized P&L + Unrealized P&L from Shorts. This affects only Buy trades, and you are not able to Buy beyond 5x capital.
Limits on Concentration of Capital
The market value of any position (in a single instrument, either long or short) cannot breech 20% of your current capital. Orders that would cause a position to breach this limit will be rejected. If a position crosses this limit due to P&L changes on the position or the portfolio as a whole, only orders that cause the market value of the position to be reduced will be accepted. Rule is enforced by system automatically.
Attendees Drawdown Limit
A 65% loss of the initial Account Size i.e. down to an account balance of $350,000 will result in a suggested 1-day cool-down period (no active trading). It is recommended (but not required) that the Participant creates and submits a drawdown plan including a revised risk approach to avoid a continual drawdown. After the cool down period, the Participant will be entitled to resume trading the remaining funds in the Account.
Loss of Capital
Either by request of participant due to significant loss or a 100% loss of your account i.e. your trading account goes to $0 will result in a reset of your trading account i.e. that track record will end as of that date. You may start a new track record on the Monday following this reset (or on the next available trading day if the market is closed on the Monday). During this reset period we advise you to rethink your trading plan and determine how you will trade differently over the next trading period.
Violations
Violating the Rules will be noted.
*Securities will be filtered for reasonable volume, market capitalization and/or other factors affecting their tradeability on the Zolio platform.
**If a security is above $100 million market capitalization when purchased, but falls below this threshold during trading, a system generated liquidation of the position will be initiated.