I get the same thing on a S500 weighing in at 1300g. I'm using the latest release (safety fix) In AltitudeHoldSettings I use "Attitude comp" at 200, default for the rest.
The other thing I've noticed is in position mode and using the option* which allows xmitter control of altitude(ThottleControl FALSE), a very miniscule change in throttle makes a altitude change and I can't get it to stay at an altitude at all. I like how it goes straight up, but I got a camera and gimbal and want to take video with the thing reasonable still. Don't know if there is something to adjust that?
So I can set the position mode option back to holding altitude (ThottleControl TRUE) and climb using regular altitude hold, then switching to position mode. But recently I read a post saying Return to Home needs the option set to ThottleControl FALSE. If I have to do that, I lose RTH functionality.
I haven't tried RTH with newer releases yet, so no first hand experience to report.
* ThrottleControl in VTOLPathFollowersettings.