SIM’s need-to-know Financial Lexicon

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A situation where investor risk tolerance drives share price behaviour on stock markets. Quite often risk-on, risk-off behaviour follows global markets, where periods of perceived low financial risk encourage investors to take risk, therefore creating a risk-on situation, and periods of perceived high financial risk cause investors to take less risk, creating a risk-off situation. Risk-on, Risk-off is the concept of investor sentiment fluctuating in a herd-like manner depending on the risk environment. This investor behaviour is more likely to occur in times of economic uncertainty.
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