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Elements · Proposition VI of VI

Risk is measured continuously.

VIWhy it holds

Whatever position the book is in, the system knows it: exposure, drawdown, correlation and the gap between live and backtested behaviour, recomputed as they change.

Limits are set in calm and enforced in motion. Monitoring is not a report read the next morning — it is a measurement that never stops.

∎Proof

DDt=1−Vtmax⁡s≤tVsDD_t = 1 - \frac{V_t}{\max_{s \le t} V_s}
Proof · know the drawdown you are inIllustrative · seed 506
equitylimit −8%drawdownday 165: risk cut automatically
Above: a simulated equity curve. Below: the same path as distance from its last peak, recomputed on every tick. The limit is set before the strategy goes live; the moment the line crosses it, the system acts — not when someone happens to look.

Q.E.D.