Multi-Level 6 Correlation Limits v1.0

Micro Harvesting Governance Framework (v1.0)

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When multiple Level 6 positions move together, governance steps in before correlation becomes risk.

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I. Purpose of the Rule

The Multi-Level 6 Correlation Limits define how many Level 6 positions the Micro Harvesting system may hold simultaneously, and how much total deployed capital may be exposed to Level 6 positions at any given time.

This rule exists to address a specific systemic risk:

Even well-designed positions become dangerous when they experience stress at the same time.

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II. Core Risk Being Controlled

Level 6 positions share three characteristics:

1. High capital concentration

2. Limited remaining defensive actions

3. Psychological weight on the operator

When multiple Level 6 positions are active simultaneously, the system is exposed not just to price risk — but to correlated stress risk.

This rule limits that exposure by design.

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III. Maximum Number of Level 6 Positions

At any given time:

Only a maximum of TWO (2) stocks may be promoted to Level 6 within the active portfolio universe.

Clarifications:

• The portfolio universe is assumed to consist of approximately 20 stocks.

• Level 6 eligibility must still be earned, not assigned.

• Promotion beyond two Level 6 positions is not permitted, regardless of perceived opportunity.

This constraint ensures that no more than 10% of the portfolio by count can ever be in the highest-risk, highest-commitment state.

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IV. Capital Allocation Limits for Level 6 Positions

The combined capital allocation of all Level 6 positions — inclusive of Anchor Shares and RTS — must fall within the following range:

Minimum: 20% of total deployed capital
Maximum: 30% of total deployed capital

Notes:

• This is a range, not a target.

• The system does not attempt to optimize for being “fully allocated” at Level 6.

• Being below 20% is acceptable; exceeding 30% is not.

This ensures that even under full stress, the majority of capital remains flexible and psychologically light.

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V. Interaction with Terminal Allocation Doctrine

Once a Level 6 position reaches Terminal Allocation State:

• It continues to count toward:

  • the 2-stock Level 6 maximum

  • the 20–30% capital allocation limit

• No additional Level 6 promotions may occur until:

  • capital exposure is reduced, or

  • the position exits via harvesting or SUNSET

This prevents the system from stacking terminal exposures.

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VI. Prohibited Behaviors

The following are explicitly prohibited under this rule:

1. Temporary Level 6 Promotions

   • No “just for now” upgrades.

2. Reclassification to Bypass Limits

   • No volatility relabeling to create room.

3. Capital Creep

   • No incremental additions that push Level 6 exposure beyond 30%.

Any of the above constitutes a governance violation, not a tactical choice.

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VII. Operational Implications

When the Level 6 limit is reached:

• New opportunities must wait.

• Capital must resolve or rotate downward.

• Inaction is not a failure — it is a designed outcome.

This rule protects the operator from making comparative decisions under stress.

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VIII. Governance Intent

This rule exists to answer a dangerous internal question:

“What if several of my best ideas are right — but wrong at the same time?”

The answer is:
The system survives anyway.

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IX. Status

• Version: v1.0

• Scope: Portfolio-wide

• Applies To: All Level 6 promotions and active Level 6 positions

• Effective: Upon approval and publication in the Governance Hub | February 14, 2026

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📌 Shariah Compliance Advisory (Updated Nov 26, 2025)

The PSE has confirmed that its Shariah screening program is currently paused, with no new lists to be released until their internal review is completed. Although news outlets reported quarterly updates up to mid-2025, these later lists are no longer accessible on the PSE website.

For now, the PSE’s Shariah-Compliant Securities page and all past lists have been removed from the public website. The December 24, 2024 list is the last official version in Micro Stock Trader’s possession, downloaded before the page was taken down, although other investors may still hold later copies such as the reported July 4, 2025 release.

All halal-focused strategies under Micro Stock Trader will use a conservative, self-screened approach until official guidance resumes, in shā’ Allāh.

• Micro Stock Trader: 2024 List of Shariah-Compliant Stocks at PSE – As of December 25, 2024

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Disclaimer

This post is for educational and documentation purposes only. It is not investment advice. Perform your own due diligence and consult qualified financial professionals before making investment decisions. All strategies, frameworks, and examples described here reflect the personal methodologies of Micro Stock Trader and are not guarantees of future performance.

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