One question Hedgeye CEO Keith McCullough says he’s been asked by investors a thousand times recently: Should investors begin buying exposures which work in Quad 2 (growth and inflation accelerating simultaneously) right now?

Be very careful with that McCullough warns.

While our proprietary Growth, Inflation Policy (GIP) model is seeing some positive inflection come Q4, jumping the gun early comes with great risk.

The more important question that no one is asking him, McCullough says in the clip above, is, “What if the data is worse than we’re expecting?”

“If the data looks like the Chinese data does [lately] in the fourth quarter, we could easily go to the third quadrant [growth slowing, inflation accelerating],” he explains. “Why doesn’t our number have downside bias to [Quad 3]? The market signal says that it does and the incoming data says that it does. We’re not being cavalier about not going to Quad 2 yet. I don’t believe that [fourth quarter] number is going to be that strong because the market signal and the incoming data isn’t giving me that belief.”

Watch the full clip above for more.