> For the complete documentation index, see [llms.txt](https://zessai.gitbook.io/zessai-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://zessai.gitbook.io/zessai-docs/getting-started/zess.ai-definitions/zess.ai-definitions-ai-grid-trading.md).

# Zess.AI Definitions: AI Grid Trading

## <mark style="color:$success;">Strategy Type</mark>

### AI Grid Trading

An AI-powered trading strategy that automatically places and manages multiple buy and sell orders within a defined price range. Rather than predicting market direction, the AI aims to profit from normal price fluctuations while continuously managing positions and risk.

***

## <mark style="color:$success;">Grid Configuration</mark>

Grid Configuration contains all of the settings used to build and manage your AI Grid Trader.

***

### Trading Setup

#### Trading Pair

The market or asset the AI Grid Trader will trade, such as **BTC/USDT**, **ETH/USDT**, or **SOL/USDT**. The AI will only monitor and trade the selected market.

#### Investment (USDT)

The total amount of **USDT** allocated to your grid trading strategy. This is the capital the AI uses to place and manage grid orders.

**Example:**

* Investment = **1,000 USDT**
* The AI can use up to **1,000 USDT** of your capital for this strategy.

#### Leverage

The amount of exchange leverage used for the grid strategy. Leverage increases buying power by allowing the AI to control a larger position with less capital.

**Example:**

* Investment = **1,000 USDT**
* Leverage = **5×**
* Maximum Buying Power = **5,000 USDT**

Higher leverage increases both potential profits and potential losses.

***

### Grid Parameters

#### Grid Count

The number of price levels the AI creates within the trading range.

* **Lower Grid Count** = Wider spacing, fewer trades, larger profits per trade.
* **Higher Grid Count** = Narrower spacing, more trades, smaller profits per trade.

#### Distribution

Determines how your investment is distributed across the grid levels.

**Gaussian (Recommended)**

Allocates more capital near the center of the trading range where price is most likely to trade.

**Uniform**

Allocates the same amount of capital to every grid level.

**Increasing**

Gradually increases position sizes toward one side of the grid.

**Decreasing**

Gradually decreases position sizes toward one side of the grid.

***

### Price Bounds

The upper and lower price limits within which the AI is allowed to place and manage grid orders.

#### Auto-Calculate Bounds (ATR)

Automatically calculates the upper and lower price boundaries using the **Average True Range (ATR)**. This allows the grid to adjust automatically as market volatility changes.

#### ATR Multiplier

Controls how wide the AI sets the trading range when using ATR-based price boundaries.

* **Lower Multiplier** = Narrower grid with more frequent trades.
* **Higher Multiplier** = Wider grid that can accommodate larger market swings.

***

### Risk Control

#### Max Drawdown (%)

The maximum percentage loss the account is allowed to experience before the AI performs an emergency shutdown or closes positions to protect capital.

#### Stop Loss (%)

The maximum loss allowed on an individual position before the AI automatically closes that trade.

#### Daily Loss Limit (%)

The maximum percentage of account equity the AI is allowed to lose in a single trading day. Once this limit is reached, the AI stops opening new positions until the next trading day.

***

## <mark style="color:$success;">Additional Definitions</mark>

### Grid Level

A single buy or sell order placed at a specific price within the grid. Together, all grid levels form the complete grid strategy.

### Trading Range

The area between the upper and lower price boundaries where the AI is allowed to place and manage grid orders.