Growth-Inflation Sector Timing — Tactical Asset Allocation Strategy

Macro regime rotation based on growth (SPY 200d SMA) and inflation (sector relative performance). Classifies the economy into 4 quadrants and allocates to the sector ETF that historically performs best in each regime. Inflation signal derived from relative strength of inflation-positive sectors (XLE/XLB/XLI/XLF) vs inflation-negative sectors (XLU/XLV/XLP/XLY).

Backtest Performance (2000-01-31 to 2026-04-07)

MetricGrowth-Inflation Sector Timing
Compound Annual Growth Rate (CAGR)12.7%
Maximum Drawdown-43.2%
Sharpe Ratio0.66
Sortino Ratio0.92
Annualized Volatility21.6%
Calmar Ratio0.29
Total Return2166.0%
Backtest Period26.1 years

Strategy Details

Type
Tactical (TAA)
Rebalancing
monthly
Risk Level
aggressive
Variants
2
Author
Inspired by David Varadi (CSS Analytics)

Categories

Sector-RotationMacroInflation

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