Meaning of risk-off | Babel Free

Definitions

A mode of investment behavior in which investors shift high-risk investments to low-risk investments.

uncountable

Examples

“In a risk-on environment, they then sell⟳ those currencies and use⟳ the proceeds to buy⟳ risk⟳ assets with greater price appreciation potential. In a risk-off environment, they're compelled to sell⟳ their risk⟳ assets and buy⟳ back those funding currencies that they previously sold.”

“The yen tends to appreciate in the aftermath – first two quarters – of risk-off episodes, whether the appreciation is measured as nominal, real effective, or bilateral against the U.S. dollar (Figure⟳ 6).”

“It is also noteworthy that risk-off events have⟳ happened more often since 2007.”

“My answer⟳ is a straightforward no, but that the recent episode of global financial market turmoil is likely to be more serious than any period of volatility and risk-off behaviour since 2009.”

CEFR level