Which of MI's underlying assumptions seem to be called into question by the looming COVID crisis in China?

Possibly none. But I don't know, hence my question. Most of our MI algorithms are predicated on rebalances much more often than annually: the Virus crisis in the PRC will take longer than that to unroll and settle out. It's not just a matter of the expected economic slowdown in the PRC rippling out, it's why and how it might ripple: supply chain relocation, initial resources obtained elsewhere or substituted out, trade decoupling, and so on. Do any of these impact the underlying algorithm assumptions--not just algorithms' penchant for rolling to other companies, but the assumptions, if any, underlying that penchant.

Regarding market timing, it certainly can be part of MI, beginning with a mechanical decision to time or not, and if so, following mechanically the mechanically derived (if not effectively backtested for efficacy) the timing criteria.

Eric Hines

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