Radar Perene / Archive / article

Appetite returned. Conviction did not.

◦ Written under index methodology v1 (in effect until 15 Jul 2026). The current series is v2 — readings quoted here may differ from those shown today. See the methodology.

Article

The extreme

When faith in the plot wavers but no one wants to leave the stage, capital does not flee — it withdraws to the most predictable corner of the room. In that winter of 2024, domestic money made this gesture twice, and the second belied what the first seemed to promise. In numbers: in July, the Utilities/IBOV ratio moved from the center of the grid to the top, while a fiscal-stress derivative lit up in territory the archive rarely visits. Risk appetite was already breathing — it rose from 37.9 to 52.9 — but the shelter was unmistakable: power, sanitation, concessions. Selic at 10.5% a year, the dollar at R$ 5.54.

What happened next

Thirty days later, appetite did not retreat — it advanced. The Perene Risk Index rose from 52.9 to 64.0, and the mood gauge, pinned to the floor for six months, leapt from 30.3 to 60.6. By the sentiment indices, fear had given way. Underneath, the opposite: the Cyclical/Non-Cyclical ratio sank further — the sharpest deterioration of the month — and real estate funds fell to an unusual band. Utilities stayed at the top, and fiscal stress, far from receding, pushed deeper into rare territory.

What did not happen

The recovery in mood was not a return of confidence. The easy reading — appetite back, therefore conviction back — does not hold once the two months are set side by side. August left the line that captures the mismatch: the investor went back to accepting risk without going back to believing in the cycle. Nerve loosened because the entrenched fear of the previous months gave way, not because faith in growth returned. Rotation within defense, not an exit from it.

The honest verdict

Set side by side, the pair reveals what no single month would show: a risk-on that is not confidence. In July, capital sheltered in utilities under fiscal discomfort; in August, it accepted more risk and still liquidated everything that depended on the cycle. Appetite returned; conviction did not. Buying what rises without buying what grows is switching to the shallower lane — without leaving the water.

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Characters: Cyclicals × defensives · Structure (intermarket)