Research preview

The recent remarks by Iran’s foreign minister and the contradictory statements from the U.S. president illustrate how quickly political risk can flare into market volatility. For quantitative traders, such events are a reminder that models built on massive data sets must be robust to sudden regime shifts. This article shows how to embed geopolitical risk into high‑dimensional regressions, factor models, and machine learning pipelines without violating the constraints of over‑fitting. 1. Why Geopolitical Shocks Matter for Quant Strategies Even when a single news item seems isolated, it can trigger correlated moves across currencies, oil, equities, and credit spreads....