How geopolitical risk turned into a systemic stress test
Conflict over resources is reshaping markets in a way that goes beyond occasional risk premia
For decades, global markets treated geopolitical risk as a transitory disturbance – a headline-driven premium that flared briefly before fading back into the noise of macro fundamentals. War scares, sanctions, territorial disputes and regime crises were modelled as temporary volatility spikes, rarely altering long-term asset allocation or risk frameworks.
Traditional risk models treat geopolitical events as low-probability, high-impact tail risks. Scenario libraries include war, embargoes and
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