changing size of position based on strategy-driven criteria
Author: mkalayog
Creation Date: 12/21/2010 9:33 PM
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mkalayog

#1
How do I vary the size of the position based on internal strategy criteria? For example, if I want to place $100 in any trade that triggers when .DJI >11,000, but place $200 in any trade when .DJI <11,000, how would I do that? I didn't see anything in the PosSizers that would allow me to do that easily.

Thanks,
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Eugene

#2
First thing that comes to mind is this PosSizer:

Position Sizing with the Trend

It has an option to use the text of an entry signal to detect bullish and bearish trend, and increase the size accordingly. So for example, when when .DJI >11,000 you call the entry signal "bearish" and the PosSizer will use the specified Fixed Dollar size. When .DJI gets below 11,000, your system calls this entry "bullish" and it will adjust the trade size by any percent specified.
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mkalayog

#3
this works, but it's not very useful because it can only take into account a binary variable (e.g., < X or > X). Is there a better way? For example, any way to take into account multiple ranges of an indicator (for example if X is between A and B invest $10, if between B and C invest $20, if between C and D invest $30, and so on...)? Optimally this would be driven by an equation.

Thanks,
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Eugene

#4
Yes there already is:

Priority Adjustment PosSizer

Just assign the indicator's value as a Priority to the Position, set up the PosSizer, and off you go.
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Eugene

#5
QUOTE:
Optimally this would be driven by an equation.

Sure it's possible that you implement the equation in a custom PosSizer. Helpful links:

* Wealth-Lab Version 6 (.NET) Development Guide > Create a PosSizer
* MS123.PosSizers demo source code
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