What is regime detection, really?

Most quantitative tools assume the market is a single distribution. It isn't.

A 1% down day in a low-volatility uptrend is a buying opportunity. A 1% down day in a high-volatility crash is the start of a much worse day. Same signal, different regime, opposite trade.

How we define a regime

A regime, in our framing, is a persistent statistical state of the market — a combination of trend, dispersion, volatility, breadth, and risk-asset behavior that tends to last weeks to months.

We track fifteen of these dimensions independently, then compute confluence — a score that rises when independent signals agree.

Why this matters

Strategies have regimes where they win and regimes where they lose. Knowing the regime is half the edge. The other half is having the discipline to act on it.

That's what RegimeLab is built for.