Geopolitical Risk Investing:
How to Use Game Theory for Strategic Asset Allocation in 2026 When China imposed sudden export restrictions on rare earth elements in late 2025, global markets convulsed. Tech stocks plummeted, commodity prices spiked, and emerging market currencies tumbled in unison. Investors who had carefully diversified their portfolios across geographies and asset classes watched helplessly as correlations converged and their hedges evaporated. The event underscored a harsh reality: in an era of strategic competition between nation-states, traditional diversification isn't enough. Welcome to the new paradigm of geopolitical risk investing. In 2026, portfolio managers, CIOs, and macro strategists need more than Modern Portfolio Theory—they need to think like strategists. By applying game theory to model the moves and countermoves of geopolitical actors, investors can build portfolios that are truly resilient in the face of escalating tensions, trade wars, and power struggles...