What if climate models force a step-change repricing of long-tail property catastrophe risk?
Forward-looking climate models force a step-change repricing of long-tail property catastrophe risk, marking down insurers' capital as physical-risk VaR is recognized, an NGFS scenario theme.
how we built this number — every step
The class rate is measured from our dated, sourced event library (decade-normalized Poisson — the full table is public at base_rates.json). The variant’s share within its class is the analyst’s editorial call, published so you can audit it. A wider range means thinner precedent. Full recipe: methodology · scored at Reality Check.
The butterfly cascade
How this trigger trickles across markets, left → right — the root shock, its first‑order moves, then the ripple effects. Drag any node; tap a market for its real price history.
Resolution timeline — how this probability is moving
Our model's odds (gold) over time vs the crowd's (Polymarket, blue), from the past toward the 3–10 years horizon. Each dot is a real macro event that nudged the probability — green pushed it up, red pushed it down. Tap a dot for the source. The gold path is an illustrative reconstruction anchored to today's estimate — real dated events, not a live re-estimate history.
What it would mean
If this plays out, it is a risk-off shock. Forward-looking climate models force a step-change repricing of long-tail property catastrophe risk, marking down insurers' capital as physical-risk VaR is recognized, an NGFS scenario theme. The trigger decomposes into signed root‑shocks — Climate/crop supply ▲ · Credit spreads ▲ · Food inflation ▲ · Recession signal ▲ · Risk appetite ▼ — which propagate through our causal graph to the markets below.
If it happens — the markets it would move
Biggest moves first. Projected moves are cascade-model priors; hist A–B% = what comparable past events actually did (measured abnormal returns), and model prior · unmeasured marks markets with no analogue backing yet. Tap any market for its price history.
| Market | Class | Projected move | |
|---|---|---|---|
| 1 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▼ -1.1% hist -1.78–+0.12% · other way +30.07% (n=12) |
| 2 | Solana SOLon Hyperliquid 📈 chart | Crypto | ▼ -0.9% hist -1.97–+0.43% · other way -2.27% (n=10) |
| 3 | Hyperliquid (HYPE) HYPEon Hyperliquid | Crypto | ▼ -0.7% model prior · unmeasured |
| 4 | Volatility (VIX) VIXon Hyperliquid 📈 chart | Vol | ▲ +0.7% hist -1.84–+4.77% · other way -9.24% (n=12) |
| 5 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▼ -0.7% hist -0.49–+0.39% · other way -0.08% (n=12) |
| 6 | High-yield credit HYG 📈 chart | Rate | ▼ -0.7% hist -0.48–-0.12% · other way -0.41% (n=12) |
| 7 | Bitcoin BTCon Hyperliquid 📈 chart | Crypto | ▼ -0.7% hist -1.79–+2.11% · other way +8.0% (n=10) |
| 8 | Wheat WHEATon Hyperliquid 📈 chart | Commodity | ▲ +0.7% hist -0.71–+2.46% · other way -3.04% (n=12) |
| 9 | Ether ETHon Hyperliquid 📈 chart | Crypto | ▼ -0.6% hist -2.02–+1.8% · other way +3.01% (n=10) |
| 10 | Corn CORNon Hyperliquid 📈 chart | Commodity | ▲ +0.7% hist -0.02–+0.96% · other way -1.11% (n=12) |
| 11 | Financials XLF 📈 chart | Equity | ▼ -0.6% hist -0.86–+0.05% · other way +0.1% (n=12) |
| 12 | S&P 500 SPXon Hyperliquid 📈 chart | Index | ▼ -0.5% hist -1.73–+0.47% · other way +0.96% (n=12) |
| 13 | Semiconductors SMHon Hyperliquid 📈 chart | Equity | ▼ -0.5% hist -0.63–+0.99% · other way +1.08% (n=12) |
| 14 | Tech sector XLK 📈 chart | Equity | ▼ -0.5% hist -0.5–+0.64% · other way +0.04% (n=12) |
Probable recommendation
Historical precedent — what analogous events actually did
Across 40 analogous events (overlap‑weighted), as abnormal returns — market beta stripped, so it's the event's own effect, not the market backdrop. Shown at 20 days (persistent) and 5 days (immediate); ↺ fades = the two horizons disagree. Confidence = consistency × sample × significance.
| Asset | History says | Abnormal (20d · 5d) | Hit | n | Confidence | vs cascade |
|---|---|---|---|---|---|---|
| NG NG | SHORT | -3.9% · 5d -4.4% | 63% | 35 | 0.22 | ⚠ differs |
| CORN CORN | LONG | +0.6% · 5d -0.6% ↺ fades | 60% | 35 | 0.19 | ✓ matches cascade |
| NDX NDX | LONG | +0.7% · 5d -0.8% ↺ fades | 60% | 36 | 0.16 | ⚠ differs |
| COIN COIN | LONG | +0.1% · 5d +3.8% | 60% | 10 | 0.16 | ⚠ differs |
| JPM JPM | SHORT | -0.5% · 5d -0.8% | 58% | 37 | 0.14 | ✓ matches cascade |
| AMD AMD | SHORT | -0.2% · 5d -0.6% | 59% | 37 | 0.13 | ✓ matches cascade |
| MU MU | LONG | +2.6% · 5d -0.7% ↺ fades | 58% | 36 | 0.13 | ⚠ differs |
| SOL SOL | SHORT | -1.3% · 5d -5.5% | 58% | 12 | 0.12 | ✓ matches cascade |
| SMH SMH | LONG | +1.2% · 5d -0.5% ↺ fades | 57% | 35 | 0.12 | ⚠ differs |
| XLK XLK | LONG | +0.8% · 5d -0.6% ↺ fades | 57% | 35 | 0.12 | ⚠ differs |
| AVGO AVGO | LONG | +2.9% · 5d -1.0% ↺ fades | 55% | 29 | 0.10 | ⚠ differs |
| XLF XLF | SHORT | -0.5% · 5d -1.0% | 54% | 35 | 0.08 | ✓ matches cascade |
| US dollar DXY | LONG | +0.6% · 5d +0.1% | 54% | 40 | 0.07 | · |
| MSTR MSTR | SHORT | -1.1% · 5d -2.7% | 54% | 35 | 0.06 | ✓ matches cascade |