President-elect Trump has promised to dismantle the 2010 Dodd-Frank financial law. Democrats have promised to keep it. The likely outcome is that the most controversial parts of the law will be altered by Congress or regulators. The Volcker rule, which Mr. Trump’s Treasury secretary pick, Steven Mnuchin, last week called “way too complicated,” would be a good place to start.

Named for former Federal Reserve Chairman Paul Volcker, an early proponent, the rule is intended to impose strict limits on commercial banks engaging in “proprietary trading”—i.e., investing bank capital to make speculative trading profits. Mr. Volcker himself thought a simple, four-page rule would suffice. Wishful thinking? The product of multiple financial regulatory agencies, the Volcker rule has ballooned to nearly 300 pages with more than 2,800 footnotes.

There is no evidence that proprietary trading caused or even contributed to the 2008 financial crisis. But like many financial products, especially making loans, there is substantial risk in proprietary trading. We believe this risk should be carefully and intelligently monitored and regulated.

The questions regulators are trying to answer are: Is the risk of holding an inventory of securities to enable customers to readily buy or sell securities through a bank reasonable? Or is the risk so excessive that changes in the market price of that inventory could put the institution in serious jeopardy?

Like any seller of products in any industry, it is perfectly logical that a financial institution would hold more inventory of a product to be sold to customers if it expects the price of that product might go up and hold less of it if the bank thinks the price might go down. We wouldn’t call this proprietary trading but rather common sense. Farmers and energy companies do it, as do manufacturers.

It’s foolhardy to try to get in the minds of traders at financial institutions to determine if the inventory they are keeping is larger than the expected demand. The solution to the problem is straightforward—simply limit the amount of “trading” revenue as a percentage of the firm’s total revenue to a de minimis level, say 10%. There is a precedent for this in the Federal Reserve’s decision to limit investment banking revenue of “Section 20 affiliates” as a percentage of total revenue during the 1990s when the Glass-Steagall restrictions were still in place.

Regulators could monitor trading results over time. Trading revenues in excess of the 10% limit would be suspect, and the bank would be required to demonstrate conclusively to regulators they were not the result of proprietary trading and were in fact due to customer-related transactions. If the bank could not meet its burden of proof it would be required to reduce its inventory and the accompanying risk.

Financial institutions cannot earn more than their cost of capital without taking risks. Moreover, they are of no value to their customers or the economy unless they take prudent risks. The key to risk taking is to diversify so that no component of risk taking accounts for an outsize share of a firm’s revenue. A collateral benefit of a 10% rule is that it would increase the liquidity available to financial institutions to help stabilize market volatility, especially when markets seize up as happened during the 2008 financial meltdown.

A Volcker rule limiting investment in securities used primarily for customer transactions to a level of 10% of the firm’s revenue, carefully monitored by regulators, is simple and easy to understand and enforce. It would allow financial institutions to serve their customers in a safe and sound manner without placing the firms at risk of failing.

Should this approach prove inadequate in practice, regulators would always have the option of becoming more prescriptive and granular. Regulators should operate under the premise that simple and easy to understand and enforce is the best course until proven otherwise.