Geopolitics Index
Track global conflict risk by aggregating prediction market probabilities across major hotspots into a single value.
Formula
P = Σ (weight × probability)
Index = 100 + 100 × (P − Baseline)
Baseline recalculated quarterly from prior 90-day average.
Methodology
- 1. Fetch market prices
Every minute, pull YES prices from 10 Polymarket contracts covering major conflict regions at different time horizons.
- 2. Calculate escalation probability
For inverted markets (e.g., "ceasefire by X"), use 1 − YES priceto get conflict continuation probability.
- 3. Apply weights
Time-horizon: Near-term 45%, Mid-term 35%, Long-term 20%. Category: Russia/Ukraine 30%, China/Taiwan 30%, Middle East 30%, Tail Risk 10%.
- 4. Compare to baseline
Index = 100 + 100 × (current − baseline)
Component markets
Russia / Ukraine30%
China / Taiwan30%
Middle East30%
Tail Risk (nuclear)10%
Interpretation
<95Below baseline — lower risk
95–105Baseline — historical average
>105Elevated — above average risk
Why fixed baseline?
- Clear reference
- Compare current risk to recent history
- Stable trading
- No constant drift from moving baseline
- Interpretable
- 105 means "5% above baseline"
Data source
Polymarket — Decentralized prediction market with $1B+ cumulative volume.