Tactical Asset allocation
“Minsky Phases” tactical asset allocation model
The Minsky phases model is built on two powerful concepts from the economist Hyman Minsky
- The “Minsky Moment” – when in a speculative mania, the greatest fool has bought, and that there is no one left to buy
- Financial crisis follow each others in a loop pattern (therefore, they are not ‘accidents’)
It has three states : Long Equities, Long T-Bills, Short Equities, and tries to follow simple and logical rules.
Here’s a presentation explaining the reasoning behind the model, the indicators used, as well as the results.
As time allows, I plan to put online :
- Technical details about the model itself
- An automated monthly update of the model’s status