Dar es Salaam, Sept. 28 -- THE financial markets are affected by not only the economic indicators and corporate performance but also the sentiments of investors. Every day on the trading markets, people decide whether they want to seek risk or avoid it. It is called risk-on and risk-off sentiment.

It is very useful for traders to understand which one of these is prevailing at a particular time because it helps in analyzing trading signals and gaining insight into why certain asset classes move the way they do.

The risk-on strategy is one that develops in a period where investors have positive expectations about the economy and the markets. In times like these, the trader is willing to take more risk to earn more profits.

Risk-off behav...