Given the geopolitical unrest it is hard to claim that risk has not in increased in a material way. James Picerno at the Capital Spectator ably summarizes how the geopolitical situation informs investor sentiment. Picerno notes that despite favorable valuations the rising risks inherent in current conflict makes predictions at this point a dangerous activity.

Ticker Sense injects a measure of optimism into today’s trading by noting that the average return on the Dow after three straight days of 100 point losses has lead on average to a 1.54% bounce. It will be interesting to see how the deteriorating geopolitical backdrop has on the Ticker Sense Blogger Sentiment Poll.

One of the challenges for investors in dealing with political risk is that it is difficult to measure in any meaningful way. CXO Advisory Group however tracks down a measure that might put those with a longer term time horizon a measure of comfort. They find that historically the market has pretty much ignored the sense of the so-called “Doomsday Clock.”

The fact of the matter is that we live in a dangerous and unpredictable world. However that has been the case for millennia, not just the last few days. Those who choose to invest in risky assets have to come to grips with this reality.