create_watchlist · Alpaca MCP: Risk & Policy

WHAT IT DOES

What create_watchlist does on Alpaca

AI agents use create_watchlist to create or update resources in Alpaca — usually the action step of a workflow, after the agent has gathered context. Every call changes real data in your Alpaca environment.

WHY IT NEEDS A POLICY

Why create_watchlist needs a policy

Creating a watchlist is a non-destructive write operation that adds data to the user's account. While the server provides financial trading tools, this specific tool does not move money, execute trades, or modify positions—it only organizes symbols for monitoring. The severity is low because watchlist creation has minimal blast radius; the worst outcome is organizing unwanted symbols, which can be easily removed.

From the tool's definition Tool name 'create_watchlist' and description 'Creates a new watchlist with specified symbols' indicate a write operation that creates new data (watchlist).

Attacks that exploit this kind of access

Recommended rule Ready

Verdict

create_watchlist Rate-limited

create_watchlist stays usable, but capped — an agent stuck in a loop can't make hundreds of changes a minute. Everything else on the server is denied unless you say otherwise.

View as policy code

policy.json

{
  "version": "1",
  "default": "deny",
  "tools": {
    "create_watchlist": {
      "limits": [
        {
          "counter": "create_watchlist_rate",
          "window": "minute",
          "max": 30,
          "scope": "grant"
        }
      ]
    }
  }
}

LIMIT THIS TOOL →

Instant setup, no code required.

PolicyLayer is an MCP gateway: every tool call is checked against your rule before it reaches Alpaca, so you can run agents against it safely.

FAQ

Questions about create_watchlist

What does the create_watchlist tool do? +

Creates a new watchlist with specified symbols. It is categorised as a Write tool in the Alpaca MCP Server, which means it can create or modify data. Consider rate limits to prevent runaway writes.

How do I enforce a policy on create_watchlist? +

Register the Alpaca MCP server in PolicyLayer and add a rule for create_watchlist: allow, deny, rate-limit, or require approval. Point your MCP client at the PolicyLayer proxy URL and the rule is enforced on every call, before it reaches Alpaca. Nothing to install.

What risk level is create_watchlist? +

create_watchlist is a Write tool with medium risk. Write tools should be rate-limited to prevent accidental bulk modifications.

Can I rate-limit create_watchlist? +

Yes. Add a rate_limit block to the create_watchlist rule in your PolicyLayer policy. For example, setting max: 10 and window: 60 limits the tool to 10 calls per minute. Rate limits are tracked per agent session and reset automatically.

How do I block create_watchlist completely? +

Set action: deny in the PolicyLayer policy for create_watchlist. The AI agent will receive a policy violation error and cannot call the tool. You can also include a reason field to explain why the tool is blocked.

What MCP server provides create_watchlist? +

create_watchlist is provided by the Alpaca MCP server (mfoster5303-1/alpaca-mcp-server). PolicyLayer sits as a proxy in front of this server to enforce policies before tool calls reach the server.