# Strategy Overview

## Strategy Categories

<figure><img src="/files/TMKpGeyIT6lFFgf81kLC" alt="" width="563"><figcaption></figcaption></figure>

### Momentum Trading

Advanced momentum trading strategy with fee optimization and comprehensive risk management.

**Concept:** "The trend is your friend" - ride existing directional moves with intelligent entry/exit timing

| Attribute          | Details                                                              |
| ------------------ | -------------------------------------------------------------------- |
| **Best Markets**   | Clear trends, strong momentum, breakouts                             |
| **Risk Level**     | Medium-High                                                          |
| **Skill Required** | Intermediate-Advanced                                                |
| **Timeframe**      | Hours to days                                                        |
| **Key Features**   | RSI, MACD, Moving Averages, Fee Optimization, Overtrading Prevention |

[Learn More →](/quantsedge-docs/trading-strategies/strategy-momentum.md)

### Mean Reversion

Advanced mean reversion strategy with RSI, Bollinger Bands, and intelligent range detection.

**Concept:** "What goes up must come down" - trade against extremes with sophisticated range detection

| Attribute          | Details                                                                  |
| ------------------ | ------------------------------------------------------------------------ |
| **Best Markets**   | Range-bound, sideways, low volatility                                    |
| **Risk Level**     | Low-Medium                                                               |
| **Skill Required** | Intermediate-Advanced                                                    |
| **Timeframe**      | Minutes to hours                                                         |
| **Key Features**   | RSI, Bollinger Bands, Range Detection, Fee Optimization, Trend Avoidance |

[Learn More →](/quantsedge-docs/trading-strategies/strategy-mean-reversion.md)

### Market Making

Advanced market making strategy with dynamic spread management and sophisticated inventory control.

**Concept:** "Provide liquidity" - profit from bid-ask spreads while managing inventory risk

| Attribute          | Details                                                                      |
| ------------------ | ---------------------------------------------------------------------------- |
| **Best Markets**   | High-volume, liquid markets with consistent spreads                          |
| **Risk Level**     | Medium                                                                       |
| **Skill Required** | Advanced                                                                     |
| **Timeframe**      | Minutes to hours                                                             |
| **Key Features**   | Dynamic Spread, Inventory Management, Volatility Adjustment, Grid Management |

### Grid Trading

Systematic grid trading strategy with dynamic level adjustment and risk management.

**Concept:** "Buy low, sell high" - systematic profit from price oscillations

| Attribute          | Details                                                     |
| ------------------ | ----------------------------------------------------------- |
| **Best Markets**   | Range-bound, oscillating markets                            |
| **Risk Level**     | Medium                                                      |
| **Skill Required** | Intermediate-Advanced                                       |
| **Timeframe**      | Hours to days                                               |
| **Key Features**   | Dynamic Grid Levels, Risk Management, Volatility Adjustment |

### Breakout Trading

Catch explosive moves when price breaks key levels.

**Concept:** "Buy strength" - enter when price breaks consolidation

| Attribute          | Details                                            |
| ------------------ | -------------------------------------------------- |
| **Best Markets**   | Consolidating ranges, high volatility, news-driven |
| **Risk Level**     | Medium-High                                        |
| **Skill Required** | Intermediate                                       |
| **Timeframe**      | Hours to days                                      |

[Learn More →](/quantsedge-docs/trading-strategies/strategy-breakout.md)

## Strategy Comparison

| Strategy           | Win Rate | Avg Win    | Avg Loss | Best Market |
| ------------------ | -------- | ---------- | -------- | ----------- |
| **Momentum**       | 40-50%   | Large      | Medium   | Trending    |
| **Mean Reversion** | 60-70%   | Small      | Small    | Range-bound |
| **Breakout**       | 35-45%   | Very Large | Medium   | Volatile    |

## Choosing Your Strategy

### Match to Market Conditions

**Trending Market (ADX >25):**

* Use: Momentum, Breakout
* Avoid: Mean Reversion

**Range-bound Market (ADX <20):**

* Use: Mean Reversion
* Avoid: Momentum, Breakout

**High Volatility (VIX >30):**

* Use: Breakout, Mean Reversion (shorter timeframes)
* Reduce: Position sizes across all strategies

### Match to Risk Tolerance

**Conservative:**

* Primary: Mean Reversion
* Position size: 1-2% risk per trade
* Leverage: 1-2x maximum

**Moderate:**

* Mix: 50% Mean Reversion, 30% Momentum, 20% Breakout
* Position size: 2-3% risk per trade
* Leverage: 2-5x

**Aggressive:**

* Primary: Momentum, Breakout
* Position size: 3-5% risk per trade
* Leverage: 5-10x

## Building a Strategy Portfolio

**Diversification benefits:**

* Reduces overall portfolio volatility
* Captures opportunities across market conditions
* Lowers correlation risk

**Sample portfolios:**

**Beginner (1-2 strategies):**

* 70% Mean Reversion
* 30% Momentum

**Intermediate (2-3 strategies):**

* 40% Mean Reversion
* 40% Momentum
* 20% Breakout

**Advanced (3-4 strategies):**

* 30% Mean Reversion
* 30% Momentum
* 30% Breakout
* 10% Custom/Experimental

## Common Mistakes

**Over-complexity:** Too many indicators and rules **Solution:** 2-3 clear rules work better

**Ignoring market regime:** Using same strategy in all conditions **Solution:** Match strategy to current market

**No stop losses:** Hoping losing trades reverse **Solution:** Always use stops, accept small losses

**Curve fitting:** Optimizing until backtest perfect **Solution:** Prefer logical strategies, accept imperfect backtests

## Strategy Performance Metrics

**Key metrics to track:**

| Metric        | Good | Excellent | Purpose                |
| ------------- | ---- | --------- | ---------------------- |
| Win Rate      | >45% | >60%      | Consistency measure    |
| Profit Factor | >1.3 | >1.8      | Risk/reward efficiency |
| Sharpe Ratio  | >1.0 | >2.0      | Risk-adjusted returns  |
| Max Drawdown  | <20% | <10%      | Downside protection    |

## Getting Started

**Start with templates:**

* Use pre-built strategies
* Learn platform mechanics
* Understand strategy behavior

**Test thoroughly:**

* Backtest 3-6 months minimum
* Paper trade 5-7 days
* Start live with small positions

**Monitor and adapt:**

* Track performance vs benchmarks
* Adjust to changing markets
* Rotate underperforming strategies

***

**Choose strategies that match your style and market conditions.** No single strategy works in all markets - diversify and adapt.

**Next:** [Create Your First Bot](/quantsedge-docs/getting-started/first-trading-bot.md) | [Momentum Strategies](/quantsedge-docs/trading-strategies/strategy-momentum.md) | [Mean Reversion](/quantsedge-docs/trading-strategies/strategy-mean-reversion.md)


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