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Is the effect of a health crisis symmetric for physical and digital financial assets? An assessment of gold and bitcoin during the pandemic
The emergence of the covid-19 health crisis, in this advanced technological era where connections between markets, nations, and economies have grown stronger than ever before, the shock of the COVID-19 pandemic quickly had an impact on both physical and digital financial assets. The Chinese financia...
Autores principales: | , , |
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Formato: | Online Artículo Texto |
Lenguaje: | English |
Publicado: |
Public Library of Science
2023
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Materias: | |
Acceso en línea: | https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10645359/ https://www.ncbi.nlm.nih.gov/pubmed/37963128 http://dx.doi.org/10.1371/journal.pone.0288762 |
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author | Badshah, Waqar Musah, Mohammed Khan, Asad Ul Islam |
author_facet | Badshah, Waqar Musah, Mohammed Khan, Asad Ul Islam |
author_sort | Badshah, Waqar |
collection | PubMed |
description | The emergence of the covid-19 health crisis, in this advanced technological era where connections between markets, nations, and economies have grown stronger than ever before, the shock of the COVID-19 pandemic quickly had an impact on both physical and digital financial assets. The Chinese financial market experienced the first consequences of the covid-19 pandemic, then spilled over to other financial markets, including those for cryptocurrencies and the precious metals. This study examines the impact of the covid-19 pandemic on the volatilities of the dynamics of bitcoin and gold. Both assets share some characteristics, such as online trading platforms, however, gold is a tangible financial asset unlike bitcoin, which is digitally generated without any physical form. This study argues that the similarities and differences between bitcoin and gold play major roles in how the covid-19 crisis affected their respective dynamics. Using daily data ranging from 9/22/2014 to 1/31/2023 and employing ARMA as the mean equation for GARCH model, the impact of the health crisis (covid-19) is examined on the volatilities of the prices and volumes of bitcoin and gold. Empirical evidence points out that, the pandemic has a symmetric impact on the volatilities of bitcoin and gold price returns, causing them to be more volatile. The impact of the covid-19 observed on the volume returns of the assets, however, is asymmetrical. The empirical results give evidence to the role that the vital differences existing between these assets played during the covid-19 pandemic. |
format | Online Article Text |
id | pubmed-10645359 |
institution | National Center for Biotechnology Information |
language | English |
publishDate | 2023 |
publisher | Public Library of Science |
record_format | MEDLINE/PubMed |
spelling | pubmed-106453592023-11-14 Is the effect of a health crisis symmetric for physical and digital financial assets? An assessment of gold and bitcoin during the pandemic Badshah, Waqar Musah, Mohammed Khan, Asad Ul Islam PLoS One Research Article The emergence of the covid-19 health crisis, in this advanced technological era where connections between markets, nations, and economies have grown stronger than ever before, the shock of the COVID-19 pandemic quickly had an impact on both physical and digital financial assets. The Chinese financial market experienced the first consequences of the covid-19 pandemic, then spilled over to other financial markets, including those for cryptocurrencies and the precious metals. This study examines the impact of the covid-19 pandemic on the volatilities of the dynamics of bitcoin and gold. Both assets share some characteristics, such as online trading platforms, however, gold is a tangible financial asset unlike bitcoin, which is digitally generated without any physical form. This study argues that the similarities and differences between bitcoin and gold play major roles in how the covid-19 crisis affected their respective dynamics. Using daily data ranging from 9/22/2014 to 1/31/2023 and employing ARMA as the mean equation for GARCH model, the impact of the health crisis (covid-19) is examined on the volatilities of the prices and volumes of bitcoin and gold. Empirical evidence points out that, the pandemic has a symmetric impact on the volatilities of bitcoin and gold price returns, causing them to be more volatile. The impact of the covid-19 observed on the volume returns of the assets, however, is asymmetrical. The empirical results give evidence to the role that the vital differences existing between these assets played during the covid-19 pandemic. Public Library of Science 2023-11-14 /pmc/articles/PMC10645359/ /pubmed/37963128 http://dx.doi.org/10.1371/journal.pone.0288762 Text en © 2023 Badshah et al https://creativecommons.org/licenses/by/4.0/This is an open access article distributed under the terms of the Creative Commons Attribution License (https://creativecommons.org/licenses/by/4.0/) , which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited. |
spellingShingle | Research Article Badshah, Waqar Musah, Mohammed Khan, Asad Ul Islam Is the effect of a health crisis symmetric for physical and digital financial assets? An assessment of gold and bitcoin during the pandemic |
title | Is the effect of a health crisis symmetric for physical and digital financial assets? An assessment of gold and bitcoin during the pandemic |
title_full | Is the effect of a health crisis symmetric for physical and digital financial assets? An assessment of gold and bitcoin during the pandemic |
title_fullStr | Is the effect of a health crisis symmetric for physical and digital financial assets? An assessment of gold and bitcoin during the pandemic |
title_full_unstemmed | Is the effect of a health crisis symmetric for physical and digital financial assets? An assessment of gold and bitcoin during the pandemic |
title_short | Is the effect of a health crisis symmetric for physical and digital financial assets? An assessment of gold and bitcoin during the pandemic |
title_sort | is the effect of a health crisis symmetric for physical and digital financial assets? an assessment of gold and bitcoin during the pandemic |
topic | Research Article |
url | https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10645359/ https://www.ncbi.nlm.nih.gov/pubmed/37963128 http://dx.doi.org/10.1371/journal.pone.0288762 |
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