Risk Monitor
Market regime classification, yield curve analysis, cross-asset correlations, sector rotation, and Fed policy signals.
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About market risk & regime
The Risk & Regime page classifies the current market environment and shows the signals behind it: yield-curve shape, cross-asset correlations, sector rotation, and Fed policy tone. Use it to gauge whether markets are leaning risk-on or risk-off.
- What does risk-on versus risk-off mean?
- Risk-on describes conditions where investors favour higher-risk assets like equities and credit; risk-off describes a flight to safety toward government bonds, the dollar, and cash. The regime classifier scores where the market currently sits on that spectrum.
- How is the yield curve used as a signal?
- The shape of the Treasury yield curve — particularly the spread between short and long maturities — is a well-known leading indicator. An inverted curve (short rates above long) has historically preceded recessions and is treated as a risk-off signal.
- What drives the regime classification?
- The regime is a weighted composite of eight signals — high-yield credit spreads, VIX, the yield curve, the US dollar, M2 money supply, the Fed balance sheet, and cross-asset momentum — producing a Risk-On, Risk-Off, Transition, or Crisis label with a confidence score.