Exit reason is the recorded cause of a position being closed, shown in the "Reason" column of a backtest's trade history. There are seven — take profit, stop loss, max hold, rebalance, Exclude screener, price history ended and bankruptcy — and every closing trade carries exactly one, so you can tell why each position left the strategy.
Also seen as: close reason
How does Fincanva handle it?
- Shown in the "Reason" column of the Executions table (Italian "Motivo"), per closing trade — one position can open and close more than once, and each close carries its own reason.
- It is a record of what the simulation did, not a setting you edit: take profit, stop loss and max hold are the controls that decide when a position closes, and the reason tells you afterwards which of them closed it.
- The reasons do not share one clock. Take profit and stop loss are checked on the position's own price bars, so either can close a position between two rebalances — execution time gives the price such a close books at. Max hold and Exclude screener act only at scheduled rebalances, so a rebalance forced off schedule by a risk condition never produces either.
What does it look like in practice?
Across one backtest, five positions close for five different reasons: a stock up +20% shows Take profit; one that fell to its stop level shows Stop loss; one dropped at a scheduled reweight shows Rebalance; one held to its month cap shows Max hold; and one whose company was taken private mid-test, so its prices stop, shows Price history ended. Reading the Reason column tells you at a glance which rule ended each position.
An exit reason records what a simulation did on historical data, not what a position will do, and no reason in the column is a suggestion to close or hold anything.
What are the exit reasons a backtest records?
Each closing trade is tagged with one of a fixed set of seven causes:
- Take profit — the position reached its take-profit gain.
- Stop loss — the position reached its stop-loss threshold.
- Max hold — the position reached its maximum holding period (a time-based exit), acted on at a scheduled rebalance.
- Rebalance — the position was closed as part of a normal rebalance, when the strategy reweighted and no longer held it (this used to be called a "rotation").
- Exclude screener — at a scheduled rebalance the instrument matched one of the strategy's Exclude screeners, so it was dropped.
- Price history ended — the instrument's own price history ran out while the position was open, because it stopped trading. It is a property of that instrument, not of the backtest: a position still open on an instrument that is still trading when the backtest ends is not closed for this reason.
- Bankruptcy — a bankruptcy rule closed the position: the run, or the strategy inside a Combined, fell below 10% of its reference capital and everything it held was closed.