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 tumbles


Investor sentiment dips as interest rates move higher, growth slows


  • All major fixed income sectors declined, with long-duration U.S. Treasuries leading the losses.
  • Assets with higher spread duration — investment-grade corporate credit and emerging market debt — underperformed. Securitized credit, which has lower spread duration, outperformed.
  • Most major equity indexes declined amid the rates-driven sell-off, but value stocks outperformed growth stocks.
  • Commodities, including base and precious metals and agricultural products, dropped. Energy prices rose.
  • The U.S. dollar appreciated against other G10 and emerging market currencies.
risk key


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

risk key

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–Dec '21

Easy monetary policies and reopenings supported risk assets.

Jan '22–present

Central bank tightening expectations along with the Russia-Ukraine crisis raise market volatility.

Source: Putnam. Data as April 30, 2022. 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.