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.

Wherever one invests, 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 raw gold return was up 2.2% in the latest week; ECO metrics show gold staying in a crash state; expected return and return no correction stay positive — maintain buy.
  • JETS ETF – Posts a minor loss for the week and loses out to the broader market; stays in crash state; expected return and return no correction slip — maintain buy.
  • Oil – Registers a big gain for the week; stays in rally state; return no correction goes negative — downgrade to sell.
  • USLargeCapGrowth – Another nice move up for the week and beats value stocks; stays in crash mode; expected return and return no correction stay positive — maintain buy.
  • USSmallCapValue – Moves up for the week but gets beaten by its small cap growth counterpart; expected return and return no correction mixed — upgrade to buy.
  • RealEstate ETF – Moves up for a fourth week and beats the overall market; stays in crash state; return no crash jumps — upgrade to buy.
  • TSLA – Big jump up in the latest week but continues YTD underperformance; EV sales remain in question; stays in rally state; expected return and return no correction both negative — downgrade to sell.
  • USUnvGradeBond — Small loss for the week as rates rise; expected return and return no correction go up — upgrade to buy.
  • Technology ETF – Big gain for the week and beats the broader market and its large growth style index cohort; expected return and return no correction stay positive — maintain buy.
  • HealthCare ETF – Down for the week and loses to the broader market; maintains crash state; expected return and return no correction stay positive — maintain buy.
  • Bitcoin – Huge gain for the one week period; maintains crash state; return no correction jumps — upgrade to 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.