Classic Rebalance Range
The strategy being described here is a commonly used approach for rebalancing liquidity positions in financial markets. In this strategy, the position size is measured in ticks, which represents the smallest price increment that can be traded in a given market. The current pool tick is used as the center point, and the position size is set based on this tick.
On each trading day or period, the strategy checks the current positions to see if the pool tick has moved away from the original position. If the pool tick has moved outside of the specified range, the position will be adjusted or rebalanced to bring it back to the desired level. This involves buying or selling assets in the pool to adjust the position size relative to the new pool tick.
If the pool tick has not moved outside of the specified range, no action will be taken, which helps to save on transaction costs or gas fees associated with executing trades. This is because rebalancing a position frequently can be costly due to the fees charged by the exchange or trading platform.
Overall, this strategy helps to maintain a balanced liquidity position by keeping the position size aligned with the current market conditions. It can be an effective way to manage risk and maintain stability in a trading portfolio over time. However, like all trading strategies, it is important to carefully consider the risks and benefits before implementing this approach.
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The execution of the bundle essentially refers to the calculation of these values, which are then handled by the Steer Protocol.