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Event Risk Brief · 2025-001

Canada and Mexico tariff shock

February to March 2025 · Named after coverage by Yahoo Finance ↗

Status
Concluded
Concluded
2025-03-03
Inputs through
2025-02-27 close
See today’s live report →
What happened · scored by what the market did next
✓ Escalated within days

The system issued a more severe classification within 10 trading sessions — the hold ended with an escalation, not a miss.

The Call

STABLE (WATCH) was in effect. VIX was up 35% in five sessions; the call did not move.

Volatility jumped that week. The underlying risk state did not change.

RISK STATE
WHIPSAW
WHIPSAWSHIFTINGELEVATEDSHOCKCRISIS
WHAT THE SYSTEM DID
HELD THROUGH IT
the system classifying STABLE while VIX rises 25%+ in a week
LAST 20 SESSIONS · VIX (ORANGE) + S&P 500 (WHITE)
STABLETRIGGER WINDOW · LAST 5 SESSIONS21.114.8VIX6,1445,862S&P01/3002/1202/27
VIX · CBOE VOLATILITY INDEX
21.13
5-SESSION CHANGE +34.9%
S&P 500
5,861.57
5-SESSION CHANGE -4.2%
CONCLUDES WHEN EITHER · 3 CONDITIONS+
(a) The system escalates to a more severe state (escalated).(b) VIX's 5-session change falls back below +25% with no escalation (the scare faded).(c) No escalation within 10 sessions and the S&P 500 falls 5%+ within 20 sessions (the call was wrong).

Classification uses the prior session close (2025-02-27).

Mindforge · Brief 2025-001 · 2025-02-28

Historical Precedent48 MATCHES SINCE 2012
48 matches since 2012The query +
QUERY: risk shape == STABLE (WATCH) AND VIX 5-session change >= +25% · 3,309 SESSIONS SINCE 2012
MEDIAN PATH · 48 MATCHES · INDEXED TO 100 AT THE MATCHED MORNING
TRIGGER WINDOWTHE MATCHED MORNING · TODAY'S POSITION10077VIX102.3100.0S&P−20 SESSIONS0+15 SESSIONS

Median forward path of all 48 matched mornings. Historical pattern, not a forecast.

94%
THE SYSTEM CLASSIFIED STABLE CORRECTLY OR ESCALATED WITHIN DAYS · 45 OF 48 MATCHES
6%
THE SYSTEM WAS WRONG · CLASSIFIED STABLE THROUGH A 5%+ S&P 500 FALL · 3 MORNINGS: 2014-09 · 2015-07 · 2022-04
HISTORICAL MARKET CLASSIFICATION OUTCOMES
69%
25%
6%
33 OF 48The scare faded. The system classified STABLE and no hard fall followed
12 OF 48The system escalated within days. It issued a more severe classification within 10 trading sessions
3 OF 48The system was wrong. It classified STABLE while the S&P 500 fell 5% or more within 20 sessions: 2014-09 · 2015-07 · 2022-04
↳ CLOSEST MATCHES TO TODAY · PRIOR-CLOSE VIX < 22 (TODAY: 21.13) · 43 OF THE 48+
31 OF 43The scare faded.
10 OF 43The system escalated within days.
2 OF 43The system was wrong. 2014-09 · 2015-07

History, not a forecast · Mindforge · Brief 2025-001 · 2025-02-28

Free · issued pre-open when conditions warrant

Event Log4 SESSIONS
2025-02-25STABLE
Day
1
VIX
18.98
VIX 5d
+28.5%
S&P 500
5,983.25
SPX 5d
-2.1%
2025-02-26STABLE
Day
2
VIX
19.43
VIX 5d
+26.6%
S&P 500
5,955.25
SPX 5d
-2.8%
2025-02-27STABLE
Day
3
VIX
19.10
VIX 5d
+25.1%
S&P 500
5,956.06
SPX 5d
-3.1%
2025-02-28STABLE
Day
4
VIX
21.13
VIX 5d
+34.9%
S&P 500
5,861.57
SPX 5d
-4.2%
Sector ImplicationsTAP TO EXPAND +

10-DAY FORWARD RETURN VS STABLE PERIODS · STRESS-CLASSIFIED DAYS

CYCLICAL BASKET

+1.9pp

XLE · XLB · XLF · XLI · XLY

DEFENSIVE BASKET

-0.5pp

XLV · XLP · XLU

10-DAY FORWARD RETURN DIFFERENTIAL BY SECTOR (STRESS VS STABLE)

XLEEnergy
+2.9pp
XLFFinancials
+2.7pp
XLBMaterials
+1.7pp
XLKTechnology
+1.7pp
XLIIndustrials
+1.2pp
XLYConsumer Disc.
+0.9pp
XLUUtilities
+0.6pp
XLPStaples
-0.6pp
XLVHealthcare
-1.5pp
Sector returns measured from the classification date forward. Backtest: 2012-2024, 154 stress-classified days. Out-of-sample: 2025-2026, 24 stress-classified days. Historical analysis, not investment advice.
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Outcome definitions, system methodology, and the full classification record

Validation & Methods →

Historical base rates since 2012: history, not a forecast. Past classifications do not guarantee future accuracy. Research use only. Mindforge is not a registered investment adviser. Full terms: mindforge.tech/terms · Methodology: mindforge.tech/validation-and-methods

Research use only. Not investment advice. Past performance ≠ future results. Mindforge is not a registered investment adviser. Full terms · Methods

Event Risk Brief 2025-001 | Mindforge | Mindforge