Methodology

From macro data
to portfolio signal

MacroScope measures three forces that drive asset prices — growth, inflation, and liquidity — and combines them into a regime-based allocation system with a built-in momentum safety layer.

Growth+InflationRegime
LiquidityRisk On / Off
Momentum FilterPortfolio
Step 01

Measure economic growth

Five independent pillars capture different dimensions of economic health — financial conditions, business investment and capex decisions, input acquisition signals, production activity, and distribution and trade flows. Each pillar aggregates multiple indicators, normalized to a common scale and combined into a single growth composite that reads positive during expansion and negative during contraction.

Indicators within each pillar are grouped by data frequency to prevent high-frequency series from dominating the signal. By blending slow-moving fundamentals with faster market-implied signals, the growth composite responds quickly to turning points without overreacting to noise.

Step 02

Track inflation momentum

Six inflation channels monitor both realized price pressures and forward-looking market expectations. Rather than measuring the level of inflation, the system tracks acceleration — whether inflationary forces are building or fading across demand pressure, pipeline costs, monetary conditions, expectations, import prices, and services inflation.

Each channel isolates a distinct transmission mechanism — from excess demand and producer costs to monetary policy stance and sticky services prices. The result is a composite that turns positive when inflation is accelerating and negative when it is cooling.

Step 03

Gauge global liquidity

Five liquidity pillars track the flow of money through the global financial system: central bank balance sheets, private sector credit creation, cross-border FX credit, shadow banking and non-bank financial activity, and collateral and funding markets.

Inspired by institutional global liquidity research, the system measures the rate of change across each pillar — whether the global money supply is expanding or contracting at the margin. This impulse signal determines whether risk assets receive a tailwind or face headwinds.

Step 04

Classify the macro regime

The growth and inflation composites interact to classify the macro environment into one of four regimes. The liquidity state then acts as a modifier, creating eight distinct market conditions that each call for a different portfolio posture.

Goldilocks

Strong growth, low inflation

Reflation

Growth with rising inflation

Stagflation

Weak growth, high inflation

Deflation

Weak growth, falling inflation

Step 05

Apply volatility-adjusted momentum

Before capital is deployed, each asset passes through a volatility-adjusted momentum filter. This measures risk-adjusted returns across multiple timeframes — short, medium, and long — and combines them into a single score.

When an asset's momentum score turns negative, its allocation is automatically scaled back and moved to cash. This acts as a circuit breaker: the regime may call for a position, but if the asset is in freefall, the system steps aside until conditions stabilize. It adds a layer of tactical safety on top of the strategic regime allocation.

Step 06

Generate the portfolio signal

Each regime maps to a specific portfolio allocation across equities, gold, and digital assets. Expanding liquidity tilts toward more aggressive positioning — adding growth-oriented equities and alternative stores of value. Contracting liquidity favors defensive allocations.

The result is a daily portfolio signal: exact asset weights, updated as the macro environment evolves. No discretionary overrides, no narrative bias — just a systematic translation of macro data into portfolio positioning.

See the system in action

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