Macro Expected Value Explained
Learn how Macro Expected Value blends the four macro scenario probabilities with asset-specific historical payoff estimates.
What Macro Expected Value means
Macro Expected Value is the scenario-weighted 12-month payoff estimate shown by the Macro Model. It combines the probability of each macro scenario with the asset-specific payoff associated with that scenario. In plain English, it asks: if the current macro backdrop can be split across four feature-driven states, what does the weighted historical payoff profile look like for this asset?
Macro EV is useful because the headline macro backdrop and the asset payoff are not always the same thing. A weak macro state can still produce a positive asset payoff if the asset historically rebounded after similar pressure windows. A supportive macro state can still produce a weak payoff if the asset historically failed to benefit from similar backdrops.
How the weighted payoff works
The calculation shown to users is intentionally simple: each scenario has a probability, each scenario has an asset-specific payoff, and each row contributes to the final Macro EV. The contribution is the scenario probability multiplied by the scenario payoff. The final Macro EV is the blend of those four contributions.
This does not disclose the proprietary way the model forms the scenario distribution. It only explains how users should read the output once the scenario probabilities and payoffs are returned on the page.
Why high Macro EV readings need the table
When Macro EV is unusually large, the scenario table becomes more important than the headline. A high reading can happen because several scenarios have positive payoffs, or because one high-probability scenario has an unusually large historical payoff. It can also happen for volatile assets that experienced strong rebound windows after similar macro states.
That does not make the estimate useless. It means users should read the probability mix, scenario payoff, and contribution table together. A concentrated contribution profile deserves more caution than a broad-based one.
Macro EV is not a guaranteed forecast
Macro EV is educational market research. It is not a price target, trade instruction, or guaranteed prediction. It should be compared with Trend Detector, Trend Persistence, Timing Model, and Risk Simulation before users draw any research conclusion.
FAQ
Why can Macro EV be positive during a weak macro scenario?
Because the asset-specific payoff is based on historical behavior after similar model-labeled macro windows. Some assets rebound strongly after pressure periods.
Why can Macro EV be very large?
A very large Macro EV can be driven by high-volatility historical rebound windows or by one scenario with a large contribution. The contribution table should always be checked.
Should Macro EV be read alone?
No. It should be read with scenario probabilities, trend quality, timing structure, and risk simulation context.