Grid Trading Strategy: Rules, Risks and Lot Sizing

What a grid does

Three instructions, and none of them is a forecast. Open a position when the entry condition fires; if price moves against it, add another position at a defined distance; close the whole group together when the combined position reaches its target. The bet underneath it is that price returns — Mean Reversion Strategy: The Logic Behind Grid Expert Advisors.

Everything people argue about in a grid — spacing, lot sizing and exposure — follows from those three choices. The entry matters less than the additions when sizing risk.

How levels are spaced in general

Spacing decides how often a grid adds. Wide spacing means fewer additions, smaller total exposure and baskets that take longer to close; tight spacing means the opposite.

Neither is right on its own. The dangerous combination is always frequent additions plus aggressive sizing.

How lots grow in general

Some grids keep every addition at the same size; some grow it by a capped step; the classic version doubles it. The slower the growth, the deeper price can travel before the account is in trouble.

Doubling is the case that fails in public, and it gets its own article: Martingale Strategy in Forex: How It Works and Why Most Fail.

Where the float goes

Because nothing in the basket closes at a loss, the loss exists as a floating number on the open positions until the basket closes. That number is the honest measure of the risk, and it is measurable.

In the EURUSD Patient simulation over 2010–2025 on Dukascopy data, Horizon level with a 0.01 starting lot on a €10,000 reference account:

• 22,058 baskets closed, and 69.7% of them never needed a single addition.
• The worst floating loss was −€2,788 on 21 August 2024; the largest open exposure that day was 5.46 lots.
• The deepest fall from an equity peak was €2,788 over the same period.

The last two are different measurements with different dates. A grid needs both: the float is what the account is carrying at a moment, the drop from the peak is what the equity curve did.

What that means for capital

Sizing a grid is arithmetic, not taste. Take the worse of the two measurements above, add the margin the open lots use at that moment, and leave room above the broker’s stop-out.

For EURUSD Patient that arithmetic gives a reference €8,500 at Horizon level (simulated, 2010 to September 2026), which leaves a margin level of 523% at 1:500 leverage at the worst point of the whole simulation. The same calculation for every portfolio and level is on Kestrel EA Risk Management and Capital for MT4 Portfolios.

It is a reference figure, not a condition. An account funded below it runs the same strategy with less room to sit through the same bad week.

How Kestrel applies this

Kestrel EA is a grid expert advisor for MetaTrader 4: it opens from its own signal, adds to the basket in small, capped steps when price moves against it, and closes the whole basket together at its target. It never closes a single trade at a loss; until the basket closes, the loss is floating.

Like the kestrel that hangs still in the wind, it waits, holds and closes once. EURUSD Patient returned +309% of its €8,500 reference capital over 2010 to September 2026 (simulated, Dukascopy data), with the worst floating loss of −€2,788 on 21 August 2024 sitting on the same page. The product is Kestrel Grid EA for MT4: Expert Advisor With Controlled Lots, and the licence levels are on Kestrel Forex Robot Price and Licence Levels.