Article citationsMore>>

Zhou, M. and Ma, Y. (2025) Physical vs. Transition Climate Risks: Asymmetric Effects on Stock Return Predictability. International Review of Financial Analysis, 104, 104266.
https://doi.org/10.1016/j.irfa.2025.104266

has been cited by the following article:

• TITLE: Asymmetric Effects of Climate Risk on Bank Stock Volatility: The Role of Market Sentiment in Global Systemically Important Banks

  AUTHORS: Thomas C. Chiang

  KEYWORDS: Climate Risk, Bank Stock Volatility, Transition Risk, Physical Risk, Market Sentiment

  JOURNAL NAME: Journal of Mathematical Finance, Vol.16 No.4, November 11, 2026

  ABSTRACT: This paper examines the asymmetric effects of climate risk on bank stock volatility using data of ten major global banks. Findings are: first, macro-financial uncertainty is the driver of bank stock volatility. Second, a pronounced asymmetry presents in the climate risk-volatility relationship. Third, market sentiment plays a critical role in shaping these effects. Consumer confidence amplifies the volatility impact of transition risk but attenuates the effect of physical risk. Fourth, the covariance between investor sentiment and market volatility amplifies the impact of transition risk variance, while the corresponding interaction with consumer confidence dampens the effect of physical risk variance.