Risk On VS Risk Off

Risk On:

Definition: Investors are optimistic and willing to take on more risk.

Characteristics: Increased demand for stocks and other high-risk assets; decreased interest in safe-haven assets like bonds and gold.

Risk Off:

Definition: Investors are risk-averse and cautious.

Characteristics: Higher demand for safe-haven assets; sell-off in riskier assets like stocks; strengthening of safe-haven currencies (e.g., USD, JPY).