Long GLD/ Short Financials

Gold to outperform financials if economy continues to slow.

Financials may be vulnerable to a pull back given the slowing economic backdrop and interest rate vol.

Financials essentially have a short strangle on interest rates as higher rates commonly reduce lending and slows economic growth. While lower rates reduce earnings on loans and pools capital to only the most credit worthy borrowers. They perform well in a "sweet" spot.

Gold has favourable macro economic back drop (although has been disappointing lately) and usually outperforms relative to other risk assets in vol shock.