Backpressure Drop Degrade Policy

When to Use

Invoke this once tick-buffering-burst-handling has established bounded buffers — this skill defines what happens when a buffer is persistently at capacity, i.e., sustained backpressure rather than a momentary burst. Every real-time trading system eventually falls behind producers; the difference between a robust system and a fragile one is whether that moment is handled by a deliberate, chosen policy or by whatever the underlying queue/library happens to do by default (often "block the producer" — the worst outcome, since it propagates the slowdown back to the WebSocket read loop).

When NOT to Use

• For momentary bursts. A short spike that a bounded buffer absorbs is a buffering problem, not a policy problem — see tick-buffering-burst-handling.
• When the consumer is merely slow-to-start. Fix the consumer or scale it out before deciding what to throw away; a drop policy applied to a fixable bottleneck permanently degrades data quality to paper over a solvable issue.
• As a substitute for capacity planning. If a stream is always at its watermark, the policy is masking undersized infrastructure — see capacity-planning-for-symbol-universe-growth.
• For order/execution acknowledgements. Those are not a droppable telemetry stream; reconciliation, not sampling, is the correct response to falling behind.

Prerequisites

• Bounded buffers already in place (see tick-buffering-burst-handling)
• A per-data-type criticality classification: which data can be dropped, sampled, or degraded, and which cannot

Workflow

1. Classify each data stream by what backpressure response is acceptable:
   • Drop-oldest: for streams where only the latest state matters (e.g., latest LTP for a position-monitoring display) — safe to discard stale ticks in favor of the newest.
   • Sample/throttle: for streams feeding non-critical downstream consumers (e.g., a dashboard chart) — admit 1 of every N items under load, leaving the existing backlog intact. Throttling admission is not the same as flushing the buffer: discarding half the queue on every overflow destroys far more data than the load actually requires.
   • Degrade to lower-resolution data: for streams that can fall back to a coarser representation (e.g., tick-level to 1-second OHLC) under sustained load.
   • Never drop: for streams tied directly to risk decisions (e.g., position/margin updates feeding the kill-switch). If they cannot keep up, that is a system health emergency requiring an alert and an explicit rejection the caller must handle — not a quiet policy application.
2. Declare every stream's policy explicitly. An undeclared stream raises UnknownStreamError by default rather than falling back to a drop policy — a mistyped risk-stream name must not silently become a data-loss path.
3. Call observe() on every push, not just on overflow. handle_full() alone cannot warn you early, because by the time it runs the queue is already full — for a NEVER_DROP stream that is already too late.
4. Never let a "never drop" stream share a queue/thread pool with a "safe to drop" stream — resource contention means the safe-to-drop stream's load can degrade the never-drop stream's latency. Isolate by criticality tier, mirroring the tier separation in multi-broker-rate-limit-handling.
5. Emit an explicit alert (not just a log line) when any "never drop" stream approaches capacity. Pass a real out-of-band alert_fn; the default only writes a log warning.
6. Record, per backpressure event, which policy fired and what was dropped/degraded/throttled, so post-session review can assess whether the chosen policies matched what actually happened.

Full step-by-step procedure with broker-specific detail: see references/workflows.md. Broker/framework coverage table for this skill: see references/standards.md. Printable pre-flight checklist: see assets/checklist.md.

Common Pitfalls

• Ignoring the return value. If handle_full() returns "nothing to do" for both a successful drop-oldest and a rejected risk item, the caller cannot distinguish them and the risk item is lost. Check accepted.
• A bounded deque is already an implicit policy. collections.deque(maxlen=N) silently discards from the opposite end when you append to a full deque — Python documents this. If you append directly, you have chosen drop-oldest by accident. Route pushes through the manager.
• Compound queue operations are not atomic. deque guarantees individual appends and pops are thread-safe, but reading len(queue) and then popping that many times races with a concurrent consumer and raises IndexError: pop from an empty deque — crashing the producer thread, which is usually the WebSocket read loop. Guard every pop.
• Defaulting an unknown stream. Applying a "safe to drop" policy to a risk-relevant stream, usually because position/margin updates were lumped in with general market data or a stream name was mistyped.
• Flushing the backlog in the name of "sampling." Discarding a fixed fraction of the queue per overflow event is a different, far more destructive behavior than reducing update frequency.
• Silent degradation with no alerting — a system that quietly downgrades from tick-level to OHLC-level processing may be technically "working" while producing materially different signals than the strategy was validated against, and nobody notices until live performance diverges from backtest.
• Zero-filling missing tick fields. Substituting 0.0 for an absent price corrupts every OHLC bar built from it. Reject the tick instead.
• Misleading telemetry. A drop rate computed against overflow events rather than total pushes reads near 100% under load and tells you nothing; a rate of 0.0 when nothing was observed reads as healthy when it means "no data".
• Treating backpressure policy as a one-time decision rather than something to revisit as strategies and data volumes change.

Verification

• Run python -m unittest discover -s skills/backpressure-drop-degrade-policy/scripts — 100% pass rate (38 tests).
• Under sustained simulated overload (replay at multiples of peak historical tick rate), confirm risk-critical streams return accepted=False and trigger the defined alert rather than silently discarding.
• Confirm an undeclared stream name raises UnknownStreamError instead of being assigned a drop policy.
• Confirm the overflow path does not raise when a consumer drains the queue concurrently.
• Confirm dashboard/non-critical streams throttle admission while leaving the existing backlog intact.
• Confirm get_metrics_summary() reports drop rates against observed pushes, and None (not 0.0) when nothing was observed.

Related Skills

• producer-consumer-tick-pipeline
• tick-buffering-burst-handling
• kill-switch-and-drawdown-circuit-breakers
• graceful-degradation-priority-during-partial-outage
• capacity-planning-for-symbol-universe-growth