Scientific Validation of the Predictability Models
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An established behavioral-finance predictor, the Money Anxiety Index (MAI), identifies a portfolio of ETFs that outperforms the market in long and short positions. The analysis shows that a portfolio of the top five ETFs, with the strongest and most significant inverse or positive relations to the Money Anxiety Index, outperforms the market (S&P 500) in long and short position for 5, 3 and 1 year durations. The study was conducted during a highly volatile market, 2018-2023 showing that the hypotheses of this study are valid during bull or bear markets. The study concludes that a scientifically predictable model, using the Money Anxiety Index as a predictor, can help investors outperform the market in long or short positions, and during volatile-market conditions. |
The predictive models used by Analyticom LLC are based on a peer reviewed and published paper in a scientific journal. The newly-published study, “Dynamics of Yield Gravity and the Money Anxiety Index,” is published in the Journal of Applied Business and Economics. The study features an innovative behavioral economics predictor called the Money Anxiety Index, which measures the level of financial anxiety of people based on what they actually do with their money rather than how they respond to consumer confidence surveys.
The Money Anxiety Index is used as an economic predictor in two models in use by financial institutions. The first model, “Scientifically Predictable,” is a model for Low risk, high-confidence passive investing. The model measures the impact of behavioral economics factors on sector ETFs’, and projects the trend for each featured ETF for the next 30-90 days. The projected trend has very high statistical confidence and is updated monthly.
The second model, “Deposits Dynamics,” allows banks and credit unions to price their deposits optimally to avoid liquidity runoff and excessive interest expense. The Deposits Dynamics model adjusts interest rates on deposits to the economic environment.
The Money Anxiety Index is used as an economic predictor in two models in use by financial institutions. The first model, “Scientifically Predictable,” is a model for Low risk, high-confidence passive investing. The model measures the impact of behavioral economics factors on sector ETFs’, and projects the trend for each featured ETF for the next 30-90 days. The projected trend has very high statistical confidence and is updated monthly.
The second model, “Deposits Dynamics,” allows banks and credit unions to price their deposits optimally to avoid liquidity runoff and excessive interest expense. The Deposits Dynamics model adjusts interest rates on deposits to the economic environment.