Budget outlook for FTSE 100, gilts and sterling
Experts at eyeQ use AI and their own smart machine to analyse macro conditions and generate actionable trading signals. Here, it offers its take on UK financial markets going into the fiscal event of the year.
28th October 2024 14:06
by Huw Roberts from eyeQ
"Our signals are crafted through macro-valuation, trend analysis, and meticulous back-testing. This combination ensures a comprehensive evaluation of an asset's value, market conditions, and historical performance." eyeQ
- Discover: eyeQ analysis explained | eyeQ: our smart machine in action | Glossary
FTSE 100
Macro Relevance: 70%
Model Value: 8,322
Fair Value Gap: -0.9% discount to model value
iShares Core UK Gilts ETF (IGLT)
Macro Relevance: 41%
Model Value: 10.34
Fair Value Gap: -0.34%discount to model value
GBP/USD
Macro Relevance: 79%
Model Value: 1.2991
Fair Value Gap: -0.01% discount to model value
Data correct as at 28 October 2024. Please click glossary for explanation of terms. Long-term strategic model.
Here are some definitions of useful terms used in this video:
Model value
Where our smart machine calculates that any stock market index, single stock or exchange-traded fund (ETF) should be priced (the fair value) given the overall macroeconomic environment.
Model relevance
How confident we are in the model value. The higher the number the better! Above 65% means the macro environment is critical, so any valuation signals carry strong weight. Below 65%, we deem that something other than macro is driving the price.
Fair Value Gap (FVG)
The difference between our model value (fair value) and where the price currently is. A positive Fair Value Gap means the security is above the model value, which we refer to as “rich”. A negative FVG means that it's cheap. The bigger the FVG, the bigger the dislocation and therefore a better entry level for trades.
Long Term model
This model looks at share prices over the last 12 months, captures the company’s relationship with growth, inflation, currency shifts, central bank policy etc and calculates our key results - model value, model relevance, Fair Value Gap.
The transcript for this video is available in the description on YouTube here.
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