You can adjust your strategy’s diversification in the Portfolio section of the Strategy Edit page.
There are two methods to diversify your strategy:
- Position Size (%) changes the total number of stocks your strategy can hold.
- Allocation per Industry (max. %) limits the number of stocks you can hold in any industry up to a maximum percentage value of your portfolio size.
A quick way to decide on the Position Size you want is to consider how many stocks you want in your portfolio at any one time.
For example, if you want a 25-stock portfolio, divide 100 by 25 to get the position size (i.e. 4%). If you want a 50-stock portfolio, divide 100 by 50 and get a position size of 2%, and so on.
1) To change the number of stocks your strategy can hold, go to Position Size (%) and click on the pencil icon:
2) Enter the value you want from the ‘Portfolio’ dialogue box, in this case ‘2’ and select OK. 2% represents 50 stocks:
3) Review the Position Size (%), in this case 2% has been entered as the Position Size:
Diversify by Industry
To diversify your strategy by industry, click on the pencil icon:
1) Review the ‘Portfolio’ dialogue:
2) Enter the value you want, in this case ’20’ (note: the value is a percentage of your portfolio size):
3) Finally review your selection of 20%; This ensures that no more than 20% of your portfolio can be allocated to one industry: