cubiculum auguria

Predictions

Bubbles, crashes, rallies, and corrections

Fundamental, cyclical, and emotional factors influence financial markets and can be observed in market prices. Over various time frames, prices can exhibit non-random behavior such as trending, mean-reversion, or bubbles. These price patterns arise in all global markets and can be exploited profitably given adequate liquidity.

But price patterns are transitory and poorly understood by most discretionary investors. The Efficient Crashes Optimizer (ECO) asset price model identifies signatures in price data indicating potential crashes or rallies and estimates the magnitudes, the probabilities, and the timing of expected moves.

In the examples below, various predictions for several assets are highlighted in the table.  We track the forward-tested results of these predictions by using the ‘hedge’ column to weight each asset return.  Note that some assets can be levered up to 2X.

In addition to the assets shown here, predictions/trading signals can be calculated on a variety of individual or index returns of equities, fixed income, commodities, or currencies over various periodicities.

Our timing tools have shown benefits across a wide variety of assets.

TO SUBSCRIBE, please contact kreuser@riskontroller.com or robert@bifrostquestcapital.com.  For ongoing developments, please fill in the sign-up boxes above. 


ECO Bubble Predictions

  • Gold – The underlying precious metal was down in the past week after quite a run in 2024; ECO metrics show gold staying in a (potential) crash state; return no correction rises — maintain buy.
  • JETS ETF – The airline ETF was up quite a bit in the last week after many weeks of strong price momentum; ECO metrics show JETS staying in crash state; both expected return and return no correction move up — maintain buy.
  • Oil – Oil moved up in the past week as weekly returns seesaw; metrics show a rally state; little change in metrics — maintain hold.
  • USLargeCapGrowth – The style index was up dramatically in the past week on the election outcome; beats the broader stock market; beats value stocks for the week; stays in crash mode; little change in metrics — maintain buy.
  • USSmallCapValue – Up strongly for the week but loses out to both small stocks and small growth stocks; rotation favoring value falters; both expected return and return no correction jump — upgrade to buy.
  • RealEstate ETF – Up big in the past week but loses to the broad market; expected return and return no correction both negative — maintain sell.
  • TSLA — Records a giant gain for the week after support for president-elect pays off; stays in crash state; both expected return and return no correction jump — upgrade to buy.
  • USUnvGradeBond — Breaks a string of losses and posts a positive return for the week; stays in crash state; both expected return and return no correction improve — maintain sell.
  • Technology ETF – Posts a large gain for the week but is still a loser relative to the market YTD; performs in line with its large cap growth cohort; stays in crash state; both expected return and return no correction positive — maintain buy.
  • HealthCare ETF – Records a gain for the week but loses to the market; YTD shortfall versus the market persists; stays in crash state; return no crash falls — maintain buy.
  • Bitcoin – Records a large gain for the week with election result; maintains crash state; both expected return and return no correction move up– maintain buy.

The simulated performance of this list is tracked here.  For more details see ECO Overview, Notes, and Details

“WEBSITE AND THE INFORMATION CONTAINED HEREIN IS NOT INTENDED TO BE A SOURCE OF ADVICE OR CREDIT ANALYSIS WITH RESPECT TO THE MATERIAL PRESENTED, AND THE INFORMATION AND/OR DOCUMENTS CONTAINED IN THIS WEBSITE DO NOT CONSTITUTE INVESTMENT ADVICE.” 

To download historical ECO scores or more information, contact kreuser@riskontroller.com.


ECO scores are an important input in the AugurMax investment process.  A powerful, cutting edge asset allocation engine is created when combining ECO scores with the RisKontroller optimizer.

Verified by MonsterInsights