What is the relationship between India VIX and NIFTY 50?

India VIX and NIFTY 50 share an inverse correlation—meaning they usually move in opposite directions.

• When India VIX rises, NIFTY 50 tends to fall. A higher VIX indicates increased uncertainty, fear, or expected volatility in the market, often leading to panic selling or defensive positioning by investors.
• When India VIX falls, NIFTY 50 generally remains stable or trends upward. A lower VIX suggests market confidence, lower volatility, and a steady buying environment.

Why Does This Happen?

India VIX is based on NIFTY 50 options pricing, which reflects traders’ expectations of future volatility.

• When market uncertainty rises (due to economic events, geopolitical issues, or earnings reports), traders tend to buy more put options, driving up implied volatility, which increases VIX.
• In contrast, when markets are stable, option premiums shrink, lowering implied volatility and causing VIX to fall.

How Traders Use This Relationship

• Options traders adjust their strategies based on VIX trends (buying options when VIX is low and selling when it’s high).
• Equity traders watch VIX for market sentiment cues—a rising VIX often signals caution, while a falling VIX may suggest bullish momentum.
• Portfolio managers hedge risks when the VIX is high by increasing exposure to defensive assets or adjusting their derivatives positions.

By tracking India VIX alongside NIFTY 50, traders can make better-informed decisions about risk, market trends, and volatility-driven opportunities.

Where to Check India VIX on Share India

You can find India VIX and expert market insights in Share India’s daily reports. Check them out here: Share India’s Daily Research Reports.

Also, you can view real-time India VIX on the platform. Here’s how:

Step 1: Seach for ‘Indiavix’ in the the seach bar under the Watchlist section. 

Step 2: Click or tap on it to add it to your Watchlist and monitor the index in real time.

If you have any queries or want any help from us, you can contact the Share India support team via email at support@shareindia.com or by phone at 1800 203 0303.