APSAlgo

ADAPTIVE POSITION SIZING

Quick Facts:

• Category: Position Management
• Markets: All markets
• Timeframes: All timeframes

Overview

The APS Algorithm focuses on adaptive position sizing based on market volatility and account equity, combined with simple trend-following signals. The system adjusts position size dynamically to maintain consistent risk across varying market conditions.

When volatility increases, position size decreases. When volatility decreases, position size can increase. This maintains target risk per trade.

How It Works

VOLATILITY MEASUREMENT Track current vs historical volatility:

• Current ATR vs Average ATR
  • Volatility ratio for scaling

POSITION SIZING Calculate appropriate size:

• Base position from account risk %
  • Adjust by volatility ratio
  • Higher volatility = smaller position

SIGNAL GENERATION Simple trend-following for entries:

• EMA crossover for direction
  • Volatility filter for trade selection
  • Enter when conditions align

Key Parameters

RISK:

• accountRiskPct (1.0): Risk per trade as account %
  • maxPositionPct (5.0): Maximum position size

VOLATILITY:

• atrPeriod (14): ATR calculation period
  • avgATRPeriod (50): Average ATR for comparison
  • volAdjustment (true): Enable volatility scaling

SIGNALS:

• fastEMA (10): Fast EMA for crossover
  • slowEMA (30): Slow EMA for crossover

Best Use Cases

✅ RISK-ADJUSTED position sizing ✅ VOLATILITY-ADAPTIVE trading ✅ CONSISTENT RISK across market conditions ✅ DRAWDOWN CONTROL through sizing