A Changing Macro Regime Requires Macro Centricity
Inflation Focus
- Quantitative Easing (QE) --> Quantitative Tightening (QT)
Socialization of Costs and Rise of Populism
- Increasing preference for the socializing of costs of systemic events
- Pursuit of populist policies
Geopolitical Tensions
- Russia-Ukraine
- China-Taiwan
- China-US
- Middle East
National Security
- Rethinking of critical supply chains and protection of IP (e.g., AI, Defense, Rare Earths, Energy)
Deepening Political Divide
- Rise of extremist wings elevates policy volatility and risks of stalemates (e.g., government shutdowns)
"Butterfly Effects"
- Financial and political developments in a country can have significant knock-on effects globally
Evolving Market Structure
- Increased speed of transmission between macro developments and equity impacts
Quantitatively Aware
Active use of quantitative factors including:
- Cross-asset Flow of Funds
- Technical indicators
- Positioning and Sentiment
to better inform timing & sizing of positions
