Market Exposure
Risk ManagementThe total capital at risk across open positions, measured per currency and per pair so risk is not concentrated in one theme.
Market exposure is the total amount of capital a trader has at risk in open positions at any given moment, usually expressed in notional value or as a percentage of account equity. In forex it is measured per currency as well as per pair: being long EUR/USD and short USD/CHF at the same time leaves an account doubly exposed to the US dollar, even though the two tickets look independent.
Traders monitor aggregate exposure, sometimes called risk exposure, to avoid concentrating risk in one currency, region, or macro theme. Cutting exposure means closing or reducing positions; adding to it means the account's profit and loss will swing harder with every price move.