The no-hedging rule: why nine strategies fit where sixteen would
A no-hedging rule means two strategies that can hold opposite positions on the same instrument can't both be in the basket. Built greedily, best track first and then the next one without an overlap, a Futures 150K basket stops at nine of sixteen strategies (source: PV_EDGE Master Data, DATA 2026-10-10).
How does the rule shape a basket?
It's a counting problem, not a quality filter. Each new candidate has to clear every track already in the basket on every instrument. Above half the list there's nothing left without an overlap, so the basket closes at nine. The rule removed collisions, not the worst tracks.
What does the trailing floor add?
A static floor never moves. A trailing floor follows your peak until the buffer locks, and every strategy is sized to that floor, so a trailing account fits less size per track as well as fewer tracks.
Does fewer mean worse?
Not per dollar of risk. The nine-strategy futures basket earned 3.2× per dollar of drawdown limit in-sample against 2.8× for sixteen on forex; forex still made more dollars. The full comparison is in Fewer strategies, more per dollar of drawdown, and the rule types in prop firm hedging rules.
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Related
FAQ
Can I run the other seven on a second account? That's a question for your firm's rules on multiple accounts; the basket above is built for one account.
Does the Index Futures version obey this rule? The Futures version is sized to a 150K trailing-EOD account with whole contracts; its composition and weights are on the Index page.
Modeled and live layers are labeled separately. Monte Carlo figures (1,500 paths × 3 years) are a forecast. Hypothetical performance; past results do not guarantee future returns. Not financial advice.