Researchers introduce the Quantum Finance Index (QFI), a novel metric designed to quantify the intensity of quantum computing and algorithmic innovation at the global, US, and firm-specific levels. The index integrates two complementary components: a sentiment-based measure, constructed from Google search trends, and an innovation-based measure, derived from quantum-related patent activity.
Both components exhibit statistically and economically significant relationships with financial market outcomes. Specifically, higher QFI values are associated with increased stock returns, with an economic significance of 21.2%, as well as elevated return volatility, reflecting the inherent uncertainty and disruptive nature of quantum technologies.
Empirical findings support the QFI as a forward-looking indicator, offering a timely and informative tool for understanding asset pricing dynamics in an era increasingly shaped by emerging quantum advancements. We employ a comprehensive set of robustness tests to ensure the validity of the QFI, including a 50/50 weighting scheme, with results remaining robust and consistent with our baseline findings.