A trading book consists of positions in financial instruments and commodities held either with trading intent or in order to hedge other elements of the trading book, along with open foreign exchange positions in both the banking and the trading book. To be eligible for trading book capital treatment, financial instruments must either be free of any restrictive covenants on their tradability or able to be hedged completely. In addition, positions must be frequently and accurately valued, and the portfolio must be actively managed (open equity stakes in hedge funds, private equity investments, positions in a securitisation warehouse and real estate holdings do not meet the definition of the trading book, owing to significant constraints on the ability of banks to liquidate these positions and value them reliably on a daily basis. Such holdings must therefore be held in the conventional bank licensee's banking book and treated as equity holding in corporates, except real estate which must be treated as per Paragraph CA-3.2.29).