Research preview

The escalation of missile and drone attacks by Yemen’s Houthi group against Saudi Arabia has highlighted new sources of uncertainty for investors. For quantitative traders, the challenge is to translate such geopolitical shocks into measurable risk factors that can be incorporated into portfolio models without over‑fitting noisy data. From Geopolitical News to Quantifiable Signals Quantitative strategies rely on data that can be expressed numerically. Geopolitical events, however, are inherently qualitative. The first step is to construct a proxy series: for example, count daily incident reports, assign severity scores (1 for minor, 5 for major, 10 for casualties), or use market‑based indicators such as oil‑price volatility spikes....