HOW IT WORKS
How Sovereign allocates capital
From signal to execution: every step is governed.
No discretionary override. No emotional intervention.
The allocation pipeline
01
ANALYZE
5 Models
Each model independently evaluates 24 instruments across multiple timeframes.
02
CONSENSUS
Gate
All five must align. When consensus exists, the system approves.
03
SIZE
Kelly
Position sized using Kelly criterion based on win rate, volatility, and correlation.
04
FILTER
Regime
Current market regime determines final allocation level.
05
EXECUTE
or Not
Trade executes on your broker, your account. Or the system stays flat.
STEP 01
Five independent models
Each model evaluates the market independently. No model sees another's output.
→Momentum
Measures directional persistence across multiple timeframes. When momentum aligns on H1, H4, and D1, the model signals conviction. When divergence exists, it votes NEUTRAL.
TimeframesH1, H4, D1
InstrumentsAll 24
Weight20%
MethodMulti-TF alignment
↔Mean Reversion
Identifies when price has moved too far from its normal range. Trades the return to center when other models confirm the move is exhaustion, not a breakout.
TimeframesH1, H4
InstrumentsAll 24
Weight20%
MethodRange deviation analysis
↗Trend
Detects the dominant market direction. Distinguishes between trending and ranging environments so capital isn't deployed into conditions where trends don't exist.
TimeframesH4, D1, W1
InstrumentsAll 24
Weight20%
MethodDirection + structure
◇Volatility
Measures current volatility regime and adjusts the system's risk appetite. High volatility triggers compressed sizing. Volatility expansion signals caution, not opportunity.
TimeframesH1, H4, D1
InstrumentsAll 24
Weight20%
MethodVolatility regime detection
◉Macro
Reads the broader market environment — risk appetite, currency strength, equity behavior. Detects when conditions shift from risk-on to risk-off across asset classes.
TimeframesD1, W1
InstrumentsCross-asset
Weight20%
MethodCross-asset regime reading
STEP 02
Consensus gate
Five models must agree. When fewer than 3 align, the system stays flat.
5/5
MODELS AGREE
Full allocation
3-4/5
MODELS AGREE
Reduced allocation
<3/5
MODELS AGREE
No trade
58%
of the time, Sovereign is out of the market.
Not trading is the strategy.
Not trading is the strategy.
STEP 03
Kelly position sizing
Position size expands only when edge expands. It compresses when uncertainty rises.
%
Win rate
Recent win rate across completed trades determines base fraction
÷
Win/loss ratio
Average winning trade size vs average losing trade size
~
Current volatility
ATR-based regime assessment scales the position dynamically
⊕
Portfolio exposure
Existing open position correlation prevents concentration
Positions are never larger than the math allows.
STEP 04
Regime-aware allocation
Markets have states. Sovereign detects the current regime and adapts.
RISK-ON
Allocation100%
StopsWide
Trending market with low volatility. Full allocation, wider stops.
RISK-OFF
Allocation25-50%
StopsTight
Uncertainty signals. Reduced allocation, tighter stops. Capital preservation.
HIGH VOL
Allocation15-30%
StopsCompressed
Elevated volatility. Heavily compressed sizing. Only highest-conviction setups.
TRANSITION
Allocation0%
StopsN/A
Regime shift detected but not classified. No new positions until clarity.
CAPITAL PROTECTION
Hard 10% drawdown cap
When equity drops 10% from peak, all positions close.
No override. No exception.
This is not a suggestion. It is architecture.
-3.08%
MAX DD
TO DATE
31%
CAP LIMIT
TESTED
10%
HARD CAP
NO OVERRIDE
24 instruments
Dynamically allocated based on model consensus and regime state.
FOREX
EURUSD
GBPUSD
USDJPY
AUDUSD
USDCAD
NZDUSD
USDCHF
EURGBP
EURJPY
GBPJPY
INDICES
US30
USTEC
US500
GER40
UK100
JPN225
METALS
XAUUSD
XAGUSD
CRYPTO
BTCUSD
STEP 05
Your broker. Your account. Your custody.
Sovereign executes through an EA installed on your MT5 terminal. Trades happen on your broker, in your account. We never touch your capital.
Your Broker
Any MT5 broker. Raw spread or ECN recommended.
Your Account
Open in your name. Your deposits, withdrawals, control.
Your Custody
We cannot access funds. No LPOA required.