Time and quantile domain connectedness between the geopolitical risk of China and precious metals markets

Lu C., Zafar M. W., Cevik E. I., Destek M. A., Bugan M. F.

Resources Policy, vol.85, 2023 (SSCI) identifier

  • Nəşrin Növü: Article / Article
  • Cild: 85
  • Nəşr tarixi: 2023
  • Doi nömrəsi: 10.1016/j.resourpol.2023.103721
  • jurnalın adı: Resources Policy
  • Jurnalın baxıldığı indekslər: Social Sciences Citation Index (SSCI), Scopus, International Bibliography of Social Sciences, Aerospace Database, Aquatic Science & Fisheries Abstracts (ASFA), Business Source Elite, Business Source Premier, Communication Abstracts, Compendex, EconLit, Index Islamicus, INSPEC, Metadex, PAIS International, Pollution Abstracts, Public Affairs Index, Civil Engineering Abstracts
  • Açar sözlər: Covid-19 pandemic, Geopolitical risk, Precious metals, Safe haven, Time-varying quantile connectedness
  • Açıq Arxiv Kolleksiyası: Məqalə
  • Adres: Yox

Qısa məlumat

It is expected that the irrational behavior of the investors due to psychological reasons in risk situations, the decisions taken in fear and panic affect the performance of investment instruments, and thus the decisions of the diversified portfolio. Therefore, in this study, we investigated the existence of the argument that precious metals investments as an investment asset can protect against geopolitical risks and potentially act as a safe haven against such risks. To this end, we examine the impact of geopolitical risk for China, because China is the world leader in terms of the production of precious metals, on gold, silver, palladium, and platinum prices. In doing so, the monthly data from January 1990 to August 2022 is analyzed with time-varying quantile connectedness method. Our results show that especially during the higher tension periods such as the bombing of the Chinese Embassy in Yugoslavia in 1999, the 9/11 terrorist attacks, the trade war between the USA and China and Covid-19 pandemic, high precious metals have received spillover from the geopolitical risk index.