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The Observatory
  • The Observatory
Short Equities & Credit
Welcome to The Observatory. The Observatory is how we at Prometheus monitor the evolution of both the economy and financial markets in real-time. We’ll skip the systems updates today, but here are the top developments that stand out to us: i. Production data remained strong, but Retail Sales weakened…
  • The Observatory
What Is Economic Data Telling Us About Asset Allocation?
At Prometheus, we use a multifactor approach to systematic investment strategy. One of the many slivers our systems use is measures of economic activity to make asset allocation decisions, i.e., our Fundamental Strategy. In particular, our systems consider the impulse in economic data, i.e., the second derivative change in…
  • The Observatory
Bear Market Pressures
Welcome to The Observatory. The Observatory is how we at Prometheus monitor the evolution of both the economy and financial markets in real-time. Here are the top developments that stand out to us: i. Manufacturing data slowed this morning. NY Empire Manufacturing printed an index level of -11.6, a…
  • The Observatory
Pressure For Bear-Market Bounce Building
Welcome to The Observatory. The Observatory is how we at Prometheus monitor the evolution of both the economy and financial markets in real-time. Here are the top developments that stand out to us: i. CPI decelerated on a YoY basis but surprised expectations to the upside. By our tracking,…
  • The Observatory
Time for production to slow?
Welcome to The Observatory. The Observatory is how we at Prometheus monitor the evolution of both the economy and financial markets in real-time. Here are the top developments that stand out to us: i. Industrial Production will likely be the next shoe to drop. With our High-Frequency Growth Impulse…
  • The Observatory, The Week Ahead
Confirmed Positions + Expected Catalysts
Week 18 2022 proved challenging for Equities and Fixed Income, both finishing the week in the red. Our Alpha Strategy fared well in this context, ending the week flat. Our positions in Commodities performed strongly; however, our Gold exposures dragged on the portfolio. Our hit remained level, holding at…
  • Quantitative Tightening, The Observatory
Penciling The Path For Liquidity Drain
Today, we take a detour from our systematic commentary to provide insight into the mechanisms at play in determining the severity of Quantitative Tightening (QT). We have always stressed that liquidity, i.e., a measure of the amount of financial dry-powder available to fund and finance economic activity, is a…
  • The Observatory
Deteriorating Macro = Equity Shorts
Welcome to The Observatory. The Observatory is how we at Prometheus monitor the evolution of both the economy and financial markets in real-time. Here are the top developments that stand out to us: i. Equity shorts are looking ripe. Our systems again show opportunities to short Consumer Discretionary and…
  • The Observatory
ISM Weaker + Inflation Stubborn + QT = Tough Times
Welcome to The Observatory. The Observatory is how we at Prometheus monitor the evolution of both the economy and financial markets in real-time. Here are the top developments that stand out to us: ISM manufacturing decelerated modestly. The latest ISM Manufacturing data showed an expansionary reading of 55.4. This…
  • The Observatory, The Week Ahead
Confirmed Positions + Expected Catalysts
Last week, our Alpha Strategy suffered losses as market moves turned against our Equity, Commodity & FX exposures. This came from a decline in our hit ratios, holding at 53% over the last 12-months. The last two weeks have shown the potential for a regime shift, which our systems…
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