Catenaa, Tuesday, January 27, 2026- Investor appetite for risk is the highest in five years as optimism about the economy counters geopolitical uncertainty, according to Goldman Sachs.
The bank’s risk appetite indicator hit 1.09 last week, the highest since 2021. It’s in the 98th percentile of readings for the gauge dating back to 1991, the Goldman Sachs strategists wrote in a note.
“Such elevated levels of risk appetite are rare,” the Goldman team said, pointing to only six other examples of readings above 1.0. Still, this is not necessarily a signal to turn bearish. “Equity returns can be sustained by a supportive macro backdrop,” they said.
Most components of the Goldman index show a positive stance toward risk, underscoring the theme of broadening equity market gains in place since last year.
The most bullish drivers include investors favoring small caps over large caps and emerging market stocks over developed markets, the strategists said.
The rally in gold is among the few indicators of more cautious sentiment, and excluding bullion from the index would have driven it even higher, they said.
The precious metal has more than doubled over the last two years, with demand fueled by investors seeking havens from political risks and alternatives to currencies and bonds.
The Goldman strategists said they remain overweight on equities given the supportive macroeconomic environment.
