MA Lag Reduce: Adjusting a Simple Moving Average with a Lag Factor

Summary

The document describes an indicator that modifies a simple moving average using a configurable lag reduction factor. Users choose the lookback period, applied price, and factor. The calculation raises the ratio of the current moving average to its previous value to the selected factor, then scales the current average by that result. This makes the output respond to changes in the average, with the factor controlling the adjustment.

The accompanying figure captions compare a 14-period version at several factor settings with the standard 14-period SMA, including a zero factor. These are illustrative comparisons rather than a quantitative evaluation: the document provides no trading rules, backtest results, or evidence that reduced lag improves returns. The adjusted line may react differently from a conventional average, but the note does not discuss noise sensitivity or parameter selection. It is best read as a description of an indicator calculation, not as a complete trading strategy.

Key ideas

• The indicator adjusts a simple moving average using the ratio between its current and previous values.
• Its inputs are the averaging period, applied price, and lag reduction factor.
• The examples compare a 14-period setting across different factors and against a standard moving average.
• The document offers no strategy, performance test, or guidance for choosing parameters.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.