Condition types are the shapes a risk condition can take, chosen from the builder's Signal menu. Under Custom, "Single series" compares one instrument's indicator with two thresholds you type, and "Double series" compares two series through an Operator. Under Quantitative regimes, three more rules decide from a model instead of a comparison.
Also seen as: dual thresholds, hysteresis band, Double series
- the reading the chosen Indicator produces from the watched series on the day checked
- the Operator: is above, or is below
- a threshold you type — one in the Risk-Off comparison, another in the Risk-On comparison
- the second series' own reading, with its own instrument, Indicator and Period
The two Custom types differ only in the right-hand side: a number you type, or a second series. The three quantitative rules — Hidden regimes (Markov), Clustering and, on a Combined only, Strategy's own performance — each state their own test on their own page.
How does Fincanva handle it?
- Thresholds accept −1000 to 1000; outside that the app reports "Risk threshold must be between -1000 and 1000." A threshold is read in the indicator's own units — an index level, a percentage for a percent change, percentage points for a yield spread.
- The Operator offers "is above" and "is below", and nothing else. A rule reads which side of the line the series is on, so it switches when the series crosses and holds that state while the series stays there. A rule saved earlier with "crosses above" or "crosses below" opens, and runs in the backtest, as "is above" or "is below".
- Fincanva does not publish each indicator's engine formula or its shipped default window — engine internals — and does not suggest a threshold, a series or a type. See Is this financial advice?.
What does it look like in practice?
Take a Single series condition on a market index you choose, with the Indicator set to "Percent change" and a Period of 6, so the condition reads the index's percent change over six months — the sentence says "6-month change". In the Risk-Off comparison you set the operator to "is below" and the value to −5%; in the Risk-On comparison, "is above" and 2%.
Risk-Off is now requested when the six-month change drops below −5%, and Risk-On only once it has climbed back above +2%. A reading of −1% satisfies neither test, so an index that fell 6% and then recovered to −1% is not yet asked back into Risk-On — it has to clear +2% first. Had you set both thresholds to 0, an index oscillating around flat would ask for a switch at every crossing. The −5 and +2 are illustrative numbers that show the asymmetry, not a suggested setting; the overlap that must be avoided is on the two thresholds.
What condition types are there?
There are five, in two groups: the two Custom shapes differ only in what the watched series is measured against, and the three Quantitative regimes rules replace the comparison with a model.
| Condition type | Group | Measured against | Values its sentence holds |
|---|---|---|---|
| Single series | Custom | two numbers you type | the instrument, its Indicator (with a Period where needed), a Risk-Off and a Risk-On comparison |
| Double series | Custom | a second series | Series 1, an Operator, a Comparison series |
| Hidden regimes (Markov) | Quantitative regimes | a probability threshold on the turbulent state | Instrument, Number of states, Probability threshold |
| Clustering | Quantitative regimes | membership of the most volatile group of days | Instrument, Observation window (trading days), Number of regimes |
| Strategy's own performance | Quantitative regimes, Combined only | the Combined's own volatility, drawdown or trend | Metric, a window where the metric uses one, a threshold |
Switching between the two Custom types swaps those fields and keeps everything else you set; switching to Hidden regimes (Markov) or Clustering keeps the instrument, the Confirmation delay (weeks) and Auto-rebalance, and drops the indicator, which those rules do not use.
Why does a Single series condition have two thresholds instead of one?
Because one line would make the strategy flip every time the series wobbled across it. A series hovering at a single threshold crosses it repeatedly, and each crossing would swap the whole allocation profile — turnover for no lasting change, which is whipsaw. Two thresholds separate the point where Risk-Off is requested from the point where Risk-On is requested, leaving a band between them where neither test is satisfied and nothing is asked for.
That asymmetry is the point: the return threshold sits on the far side of the entry threshold, so the series has to travel a real distance back before the strategy is asked to return to Risk-On. Engineers call this hysteresis — the state depends on which threshold was crossed last, not on a single value. Fincanva exposes both thresholds and both operators; how the engine resolves a reading inside the band is internal. The confirmation delay works on the same problem from the other side: patience in time, where the two thresholds add distance in value.
What do Indicator and Period set?
The Indicator sets how the series is transformed before the comparison, and the Period field under it sets how many periods that transformation covers. The four options are Raw price, Simple moving average, Percent change and Average momentum. In a Double series condition each side has its own Indicator, which is how a series is compared with a transformed version of itself — the S&P 500 risk template reads "Risk-Off when the S&P 500 is below its 200-day simple moving average."