Chapters in Macro & Economy
Chapter 5 of 7 · 5 min read
Macro stress index and early-warning signs
How several stress indicators are combined into one score, and how to read the warning clusters.
A stress index combines indicators such as volatility, currency pressure, yield spreads and credit conditions into one score. Rising stress means more indicators are flashing at once, which historically goes with tighter financial conditions.
How to use it
- Look at which cluster is driving the move (currency, rates, volatility).
- A high score is a reason to size risk down, not a timing call.
- Compare current stress with past episodes in the backtest.
Key takeaways
- Stress is about breadth of warnings, not a single indicator.
- Use it for risk management and context.
- Check how past stress episodes played out.
Put it into practice
Open the live page on Market Intelligence and see this concept on real data.
Keep learning
- Shock transmission and scenario analysis · Macro & Economy
Education only, not investment advice. Updated 2026-10-09.