Financial Express today reported that, markets are near bottom according Volatility Index (VIX) movement. According to FE reports, the VIX, has eased off to around 40%, from a stratospheric 90%, as the year draws to a close. This is the most significant indicator of calm returning to equity markets.
To get a feel of the change, compare what happened within hours of the collapse of Lehman Brothers on September 15: the Vix climbed to a nervous 63% within the day. As panic set in in US, EU and UK markets, the domestic Vix remained consistently above 60% and, even until last month, remained at an anxious over 80%. The Vix coming down to 40% levels does indicate that things will remain stable. A Vix above 70% depicts fear and panic in the market.
The market usually bottoms out when the Vix reaches about 30% The levels have been pegged at 9,300 for the BSE Sensex and 2,700 for the broader NSE Nifty.
Courtesy:
Financial Express
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