Risk-on and risk-off and market characteristics [Shutarou Fudō]

Table of Contents

1. What is risk-on
2. What is risk-off
3. Characteristics of the forex market during risk-off
4. When anxiety arises, price fluctuations widen
5. How far will the drop in crude oil continue?
6. What will the market outlook be?

● Character count: 1954 characters (including headings)
● Images: 2

※ This article is a re-edited version of an article from FXKakutori.com April 2016 issue. Please note that the market information described in the text may differ from current market conditions.

Profile of Shuta Fukushima (Fudoushuutaro)

Currency instructor, author. Publishes seminar DVDs and interview CDs through a publisher. Gives talks at financial exchanges, stock exchanges, FX companies, investment trust companies, and also writes for magazines and serves as a school instructor for FX and stocks.

Official site：Shuta Fudo’s “Behind the News Coverage”
twitter：https://twitter.com/syutaro_fudo

What is risk-on

“Risk” is a word often used in daily life, but in the investment world, “risk” often refers to the possibility of financial loss.

Risk-on is translated in Japanese as “risk preference.” While no one wants to incur losses, in the foreign exchange market, risk-on means the market is less likely to experience sudden moves such as crashes that exceed expectations, and even if market predictions are wrong, large losses are less likely.

In other words, risk-on refers to a market condition where even if you invest actively, the danger of substantial losses is small, making it a stable environment to aim for profits.