---
title: "Changing pricing models for instrument types in a recipe"
slug: "changing-the-pricing-models-for-instrument-types-in-a-recipe"
tags: ["pricing model"]
updated: 2026-10-24T15:07:50Z
published: 2026-10-24T15:07:50Z
canonical: "support.lusid.com/changing-the-pricing-models-for-instrument-types-in-a-recipe"
---

> ## Documentation Index
> Fetch the complete documentation index at: https://support.lusid.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Changing pricing models for instrument types in a recipe

A [recipe](/v1/docs/what-is-a-recipe) has a `pricing` section that we strongly recommend you use to change the [default pricing models](/v1/docs/what-pricing-models-can-i-use-in-my-valuation). Note the following:

- Most instrument types support several models with different capabilities and market data requirements. The default model is typically no longer the recommended model as models have developed over time.
- You can [conditionally select different pricing models](/docs/changing-the-pricing-models-for-instrument-types-in-a-recipe#selecting-different-pricing-models-for-the-same-instrument-type) for the same instrument type, so that (for example) European options are priced using `BlackScholes` and American options using `BjerksundStensland1993`.
- You cannot change the pricing model for equities. Only `SimpleStatic` is available.

> **Note**: The combination of instrument type and pricing model impacts the quantity and quality of market data required. [Find out more about this](/v1/docs/what-market-data-does-my-valuation-require).

For each instrument type whose pricing model you wish to change, specify a *vendor model rule* in the `modelRules` array of the `pricing` section of your recipe. Consider the following example, of three vendor model rules to change the default models for bonds, FxForwards and equity options (all others are left unchanged):

```json
"pricing": {
  "modelRules": [
    {
      "supplier": "Lusid",
      "modelName": "Discounting",
      "instrumentType": "Bond"
    },
    {
      "supplier": "Lusid",
      "modelName": "Discounting",
      "instrumentType": "FxForward",
      "modelOptions": {
        "modelOptionsType": "FxForwardModelOptions",
        "forwardRateObservableType": "FxForwardCurve",
        "discountingMethod": "ConstantTimeValueOfMoney",
        "convertToReportCcy": true
      }
    },
    {
      "supplier": "Lusid",
      "modelName": "BlackScholes",
      "instrumentType": "EquityOption",
      "modelOptions": {
        "modelOptionsType": "EquityModelOptions",
        "equityForwardProjectionType": "ForwardProjectedFromRatesCurve"
      }
    }
  ],
  ...
},
...
```

In this example:

- The first rule values simple fixed-rate bonds using `Discounting`.
- The second rule values FX forwards using `Discounting`, with [model options](/v1/docs/fine-tuning-pricing-models-with-model-options#fxforwardmodeloptions) that read the forward rate from an FX forward curve, don't discount, and value directly in the report currency.
- The third rule values equity options using `BlackScholes`, with [model options](/v1/docs/fine-tuning-pricing-models-with-model-options#equitymodeloptions) that project the forward price of the underlying from the rates curve.

For information on all the fields and allowed values in a vendor model rule, examine the [VendorModelRule](https://www.lusid.com/docs/api/lusid/schemas/VendorModelRule) schema. The following table summarises key fields:

| **Vendor model rule field** | **Status** | **Explanation** |
| --- | --- | --- |
| `supplier` | Mandatory | Set to `Lusid` to use built-in pricing models. Only set a different value if you want to use a pricing model from a third-party vendor. |
| `modelName` | Mandatory | If `supplier` is `Lusid`, must be one of the models listed [here](https://www.lusid.com/docs/api/lusid/schemas/ModelSelection/). |
| `instrumentType` | Mandatory | If `supplier` is `Lusid`, must be one of the instrument types listed in the dropdown [here](https://www.lusid.com/docs/api/lusid/schemas/LusidInstrument/). |
| `addressKeyFilters` | Optional | Specify if you want to [conditionally select different pricing models](/docs/changing-the-pricing-models-for-instrument-types-in-a-recipe#selecting-different-pricing-models-for-the-same-instrument-type) for the same instrument type. |
| `modelOptions` | Optional | [Read this dedicated article](/v1/docs/fine-tuning-pricing-models-with-model-options). |

## Selecting different pricing models for the same instrument type

You can conditionally select pricing models based on:

- [Properties](/v1/docs/properties) (custom, system or derived) in the `Portfolio` domain, for example `Portfolio/People/Manager`.
- Properties (custom, system or derived) in the `Instrument` domain, for example `Instrument/FX/DataProvider`.
- [Features for OTC instruments](/v1/docs/what-are-instrument-features), for example `Instrument/Features/ExerciseType`.

For example, you might want to specify that:

- American FX option contracts are valued using the `BjerksundStensland1993` pricing model.
- European FX option contracts sourced from Bloomberg are valued using the `BlackScholes` pricing model.
- European FX option contracts sourced from UBS are valued using the `Discounting` pricing model.

To do this, specify multiple vendor model rules for the same instrument type and distinguish them using the `addressKeyFilters` field:

- The `left` field must reference the 3 stage key of either a property or a feature. In the example below, `Instrument/FX/DataProvider` is a property added to instruments of type `FxOption` to record the original data provider, while `Instrument/Features/ExerciseType` is a feature key referencing one of the available exercise types for FX option contracts in LUSID.
- The `operator` field must either be `eq` or `neq`.
- The `right` field must be a string `value` on which to match, with a `resultValueType` of `ResultValueString`. Note this means only properties with an underlying [data type](/v1/docs/what-is-a-data-type) of `String` are currently supported.

> **Note**: Vendor model rules are processed in the order they are specified in a recipe. The first matching rule found is used. Instruments that do not match any rules fall back to using the default pricing model for the instrument type, which is `SimpleStatic` for FX option contracts.

```json
"pricing": {
"modelRules": [{
  "supplier": "Lusid",
  "instrumentType": "FxOption",
  "addressKeyFilters": [{
    "left": "Instrument/Features/ExerciseType",
    "operator": "eq",
    "right": {
      "value": "American",
      "resultValueType": "ResultValueString"
    }
  }],
  "modelName": "BjerksundStensland1993"
},
{
  "supplier": "Lusid",
  "instrumentType": "FxOption",
  "addressKeyFilters": [{
    "left": "Instrument/Features/ExerciseType",
    "operator": "eq",
    "right": {
      "value": "European",
      "resultValueType": "ResultValueString"
    }
  },
  {
    "left": "Instrument/FX/DataProvider",
    "operator": "eq",
    "right": {
      "value": "Bloomberg",
      "resultValueType": "ResultValueString"
    }
  }],
  "modelName": "BlackScholes"
},
{
  "supplier": "Lusid",
  "instrumentType": "FxOption",
  "addressKeyFilters": [{
    "left": "Instrument/Features/ExerciseType",
    "operator": "eq",
    "right": {
      "value": "European",
      "resultValueType": "ResultValueString"
    }
  },
  {
    "left": "Instrument/FX/DataProvider",
    "operator": "eq",
    "right": {
      "value": "UBS",
     "resultValueType": "ResultValueString"
    }
  }],
  "modelName": "Discounting"
}],
...
```

For a more detailed demonstration of conditional pricing model selection, examine [this Jupyter Notebook](https://github.com/finbourne/finbourne-notebooks/blob/main/V1/product/ibor/Model%20selection%20using%20instrument%20features%20and%20properties.ipynb).