Geopolitical Risk Index “Powerful Predictor of Bitcoin Returns” Says Study

geopolitical risk abstract

An index that measures geopolitical risk based on newspaper reports predicts bitcoin returns according to a study of studies. “Overall, fourteen primary studies are under scrutiny in this integrated review,” the author says, looking at the relation between the Geopolitical Risk Index (GPR) and stocks, gold, oil as well as cryptos. Presenting how geopolitical risk is measured to see its effect on these assets, the study says: “The calculation of values of this index takes place by counting the number of articles that present a linkage with geopolitical risk in each of these newspapers for each month and then normalizing. To be more precise, words linked with explicit mentions of geopolitical risk, military-related tensions involving large regions of the world and a U.S. involvement and terms directly connected to nuclear tensions are involved. Furthermore, words that are tied to war threats and terrorist threats are adopted. Moreover, terms representing press…

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