Tune how a risk condition reacts
A risk condition switches a strategy between its Risk-On and Risk-Off allocations; Confirmation delay (weeks) and Auto-rebalance decide how fast and how often that switch reaches your holdings.
CBOE volatility index level. Risk-Off when volatility exceeds the threshold.
Go Risk-Off when the of .
Back to Risk-On when it .
When the rule flips, switch .
Steps
- Open the condition. On the strategy's Settings, the Risk card lists its conditions under When; open the one to tune — or build one first: Set up a risk condition.
- Set the Confirmation delay. The Confirmation delay (weeks) — "0 = act immediately.", from 0 to 12 — is how long a flip must hold before the strategy acts on it. 0 favours reacting at once; a longer delay filters out brief flips and reacts later to real ones.
- Choose Auto-rebalance. Auto-rebalance — "Trigger a rebalance when the condition flips." — makes a flip reach your holdings at once through an off-schedule rebalance; off, the switch waits for the next scheduled one.
- Check what Risk-Off holds. On the Allocation card, the Risk-Off profile has its own method and invested portion. A Risk-Off set identically to Risk-On makes the condition a no-op: the strategy still flips, but nothing it holds changes.
- Save and run again, and compare the result — see Save, run and copy a strategy.
Done. The condition flips as fast and as often as you set it, and the backtest shows when it ran in each regime. Fincanva sends no notice when a condition flips — see How do you find out your strategy has gone Risk-Off?. Take profit and stop loss are a separate mechanism that does not interact with risk conditions: Set up position exits.
What's the trade-off between reacting fast and whipsaw?
A condition that flips easily reacts to a real regime change quickly, but the same sensitivity makes it flip on brief moves that soon reverse — each reversal is a whipsaw, switching the allocation and back for no lasting benefit. A condition harder to trigger avoids most whipsaws but reacts more slowly to a genuine change, staying in the wrong regime longer while it waits.
How does Confirmation delay change that trade-off?
It sets how long a flipped condition must hold before the strategy acts on it, from 0 to 12 weeks. At 0 the strategy switches the moment the condition flips, favouring responsiveness. A longer delay requires the flip to persist before it counts, filtering out brief flips at the cost of reacting later to one that turns out to be real. See confirmation delay.
What's the cash drag when a strategy goes defensive?
Cash drag is the market return a defensive strategy gives up because more of its capital sits in cash. Going Risk-Off commonly pairs with a lower invested portion on the Risk-Off profile, so less is exposed to the market: the strategy is shielded from further declines, but it also captures less of any recovery while it stays defensive.
What's the trade-off with Auto-rebalance?
It trades immediacy against staying on schedule: with it on, the regime switch reaches your holdings right away through an off-schedule rebalance; with it off, the switch waits for the next scheduled rebalance. The mechanics: Auto-rebalance on flip.
UPDATED 2026-10-07REVIEWED 2026-10-07