The Putnam Global Risk Appetite (RA) Index is a proprietary quantitative model that aims to measure investors’ willingness to invest in risky assets, including equities, commodities, high-yield bonds, and other spread sectors. With a composite view of risk-appetite signals across a broad mix of asset types, Putnam’s RA Index provides a framework for discussing investor preferences and can signal trend changes in broad market sentiment.

Risk appetite manages to stay positive


Investor sentiment was more subdued in February as real rates increased.


  • Equity indices gained with little differentiation in returns, except for small-cap stocks, which outperformed.
  • Fixed-income assets were in negative territory amid the sell-off in U.S. Treasurys.
  • Fixed-Income assets with higher exposure to growth had positive returns.
  • Emerging-market debt with high sensitivity to Treasurys led the underperformers.
  • The U.S. dollar gained against the emerging-market currencies but dropped against growth currencies.
  • The decline in oil production lifted oil prices.


This 10-year illustration captures the cyclicality of investors' appetite for risk.

risk key

Sept–Nov '11

Eruption and subsequent clearing of concerns over EU sovereign debt crisis, U.S. debt ceiling, and fear of China hard landing drive major risk sell-off and rally.

March '16–Jan '18

Risk assets rally amid improving commodity prices, perceived stability in China's macro data, and expectations for gradualist Fed policy.

March '20–present

The coronavirus pandemic has created large swings in global risk appetite.

Source: Putnam. Data as February 28, 2021. To create the Global Risk Appetite Index, we weigh the monthly relative returns of 30 different asset classes over 3-month T-bills relative to the trailing 2-year volatility of each asset class. The higher the relative return and the lower the volatility, the greater the risk appetite; conversely, the lower the relative return and the higher the volatility, the stronger the risk aversion.