Risk-On
Risk-on describes markets where investors chase growth assets, weakening havens and supporting high-yield and commodity currencies.
Risk-on is a market mood where investors chase growth: equities up, commodity and high-yield currencies strong, havens like JPY and CHF weak.
Risk-on describes a market mood where investors are willing to take risk: equities rise, high-yield currencies and commodity dollars strengthen, and safe havens like the yen and franc weaken. It is not a single event but a persistent bias that shows in correlation across markets. For forex, risk-on typically supports AUD, NZD and CAD, and pressures JPY and CHF.
How It Works
- Reflects confidence in growth and willingness to hold risk
- Correlated strength in equities, commodity currencies and yields
- The opposite of risk-off
Trading Tips
AUD, NZD and CAD are the currency side of risk appetite
Risk-on trends can persist for months until a catalyst flips them
Trade the shift between risk-on and risk-off, not the noise within
Related Terms
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