Tark strategies trade by predefined rules. At their core are momentum and trend following, with a smaller share of mean reversion. The diagrams below show where each of them enters a trade, where it limits the loss and when it exits.
Tark strategies do not use artificial intelligence. Today it is a common marketing device, but in practice the decisions of such a model are hard to explain and to predict in advance, and for managing capital that is an extra risk.
We do the opposite: we trade clear and well-studied market inefficiencies. In essence, these are our trading approaches translated into code. The rules are known in advance and applied the same way in every trade, and the human factor is removed from trading decisions.
The strategies are built from systems with different logic. The algorithm makes the trading decision: a rule is either met or not. Every trade has a stop-loss, or simply a stop: a price level set at entry at which the position is closed if the market moves against it. The diagrams show a long trade; a short trade works as a mirror image.
Price can stay flat for a long time and then move sharply. The system enters when the move is confirmed by rising trading volume and a wider price range: this means many market participants support it. The bet is that a strong move continues for a while. The stop sits beyond the level where the move started, and the exit comes when the momentum fades.
A trend is a steady price move in one direction with pullbacks along the way. The system enters once the trend has formed and holds the position while it continues: a short pullback is no reason to exit. The trend line runs below the price lows in an uptrend and above the highs in a downtrend. The position is closed when the price reverses and crosses this line. Such trades usually last longer than the others.
When the market has no direction, the price moves in a range between an upper and a lower boundary. The system enters near the edge of the range and exits near the middle: the bet is that the price returns to it. If the price breaks out beyond the boundary, the range is broken and the position is closed at the stop.
Volatility is the size of price swings. It is not a separate approach but something the systems take into account when choosing the moment of entry and the position size. During the day the swings change: calm hours alternate with volatile ones, and volatile hours often come in a row. The stop is set according to the current swings: the wider the stop, the smaller the position, so the risk of the trade stays the same.
No approach works in every market. Momentum and trend following pay off in a strong move, while in a market without direction their trades close at the stop more often. Mean reversion works in a range and loses when a trend begins. That is why the systems complement each other.
The stop level is known when the position is opened, so the expected loss of the trade is clear in advance.
For each trade, the share of capital it risks is set in advance. The position size is calculated from this share and the distance to the stop.
Averaging down means adding to a losing position to improve the average entry price in the hope of a reversal. The standard rules do not allow this: a position that did not work out is closed at the stop, not held in the hope that the price comes back.
A position is increased when it is already in profit. For this, the price must move in the right direction and other systems must give additional confirmation.
This page describes the general approach: each strategy has its own rules and its own set of systems. The material is for information purposes only and is not investment advice.
Monitoring shows how the approach looks over time. If you have questions about the strategies or onboarding, message us on Telegram.
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