India VIX, the benchmark gauge of volatility in the Indian stock markets, tumbled 20%, indicating that market participants expect stock indices to remain range-bound in the near term despite the ongoing general election and earnings season.
The index plummeted below 10 for the first time in five months, marking the largest intraday drop since Feb. 24, 2023.
This is in contrast to the overall tendency of the Indian market, which often experiences an increase in volatility during the period preceding the general election.
India VIX, based on the Nifty 50's option prices, indicates the perception of market volatility in the near term.
A higher value indicates a greater expectation of volatility, and vice versa.
India VIX, the benchmark gauge of volatility in the Indian stock markets, tumbled 20%, indicating that market participants expect stock indices to remain range-bound in the near term despite the ongoing general election and earnings season.
The index plummeted below 10 for the first time in five months, marking the largest intraday drop since Feb. 24, 2023. This is in contrast to the overall tendency of the Indian market, which often experiences an increase in volatility during the period preceding the general election.
India VIX, based on the Nifty 50's option prices, indicates the perception of market volatility in the near term. A higher value indicates a greater expectation of volatility, and vice versa.
This sharp decline in volatility can be attributed to a sense of security rather than complacency in the markets, according to Rajesh Palviya, senior vice president of research and head of technical and derivatives at Axis Securities.
"The (India VIX) index can be taken as a measure of fear in the markets, which remains low as investors expect incumbency as a result of the general elections," he said.
