Do Tariffs and Geopolitical Risk Matter? Evidence from South Korea's Large-Cap Companies

In April 2025, international markets were shaken by a significant crash following the announcement of US tariffs on April 2.Although recent years have seen an increase in geopolitical risk in capital markets (Caldara and Iacoviello, 2022), the Geopolitical Risk Index, largely due to armed conflicts, in the first half of 2025, US trade policy caused turmoil in the international political arena and, with it, in the money and capital markets.