Convex Risk Appetite Index Forecast 2026

The primary drivers that tend to lift Convex Risk Appetite Index depend on the current macro regime. Positioning data reveals what the market is actually doing, as opposed to what it says it is doing. FINRA margin debt peaked ahead of every major bear market cycle of the last 40 years, while extreme readings in the AAII bull-bear spread are classic contrarian signals. CFTC commitments of traders separates speculative from commercial flow, identifying when large specs are overextended in either direction. Convex tracks these drivers live across the Sentiment & Positioning category and flags when multiple forces align in the same direction. See the "Key Drivers & Risks" section on this page for the current list, and check the regime dashboard for how the macro backdrop is currently tilted.

The same transmission channels that drive Convex Risk Appetite Index higher operate in reverse when conditions flip. The risk drivers listed above map directly to scenarios that, if triggered, would pull this metric in the opposite direction. Convex aggregates these into a scenario-weighted probability distribution rather than a point forecast, so the magnitude depends on which scenarios activate.

Rather than publish a point target that goes stale the day after release, Convex assembles consensus from the macro regime classification, active scenario probabilities, and historical base rates. Point forecasts from banks and strategists are worth reading for context, but they typically cluster around the consensus and miss the tail events that actually move markets. The scenario-weighted approach here captures that tail risk explicitly.