The VIX index, which measures the volatility of Indian markets fell to a 15-month-low of 11.2 points, opening the week at a more certain and a cooler pace. As fears have allayed, analysts say that August may turn up more challenging for the Indian bourses.
The volatility index closed the lowest since April 26 2024, when the index was at 10.925. A lower value in the index is an indicator of cooler markets. Markets have also been calm for the better part of July 2025, weathering the Jane Street storm.
“Markets have already factored U.S. tariffs and low corporate earnings. VIX can increase slightly in the last week of July,” said Shrikant Chouhan, Head of Research at Kotak Securities.
The current state of calm is not surprising, says Akshay Chinchalkar, Head of Research at Axis Securities. “If one examines the data from the last decade, the average value for the India VIX has been around 17. One standard deviation below the mean is approximately 10.6. This is the level at which the fear index has shown a tendency to bottom out. Secondly, if one looks at July, 90% of the time in the last 10 years, it has ended lower with an average decline of 1.7 points. So, it is not at all surprising that the gauge has largely fallen this month,” said Mr. Chinchalkar.
“In August, however, it tends to do the opposite – it has risen in eight out of 10 years for the month with an average jump size of 1.6 points. Since the VIX and the Nifty tend to move in different directions most of the time, seasonally speaking, August could present investors with some challenges. The tariff deadline is the first of August, so that can be the catalyst that drives up volatility,” Mr. Chinchalkar added.
Published – July 21, 2025 10:31 pm IST