🔹 India VIX 

1. What is India VIX?

• India VIX = India Volatility Index.

• It measures the expected volatility in Nifty 50 over the next 30 calendar days, based on Nifty options prices.

• It is annualized — meaning if VIX = 12, market expects 12% yearly volatility.

• It shows magnitude of moves, not direction.

👉 High VIX = market expects bigger swings.
👉 Low VIX = market expects calm, range-bound market.

2. How to convert VIX into daily / weekly / monthly moves?

Since VIX is annualized volatility, we “de-annualize” using the square-root of time rule:

Volatility for D days=VIX×squar-root D/252​​

Where:

• 252 = number of trading days in a year

• D = number of trading days you want (1 for daily, 5 for week, 21 for month approx.)

3. Example: Nifty = 24,000, India VIX = 12

Step A) 1 Day Move (D = 1)

=12× squar-root (1/252) ≈ 12×0.063 = 0.756%

👉 Daily expected move = 24,000×0.756% ≈ 181 points

Step B) 1 Week Move (D = 5)

=12× squar-root (5/252) = 12×0.141 = 1.69%

👉 Weekly expected move = 24,000×1.69% ≈ 405 points

Step C) 1 Month Move (D = 21)

=12× squar-root (21/252) = 12×0.289 = 3.47%

👉 Monthly expected move = 24,000×3.47% ≈ 832 points

✅ Summary (Nifty 24,000, VIX = 12):

• 1 Day: ±181 points

• 1 Week: ±405 points

• 1 Month: ±832 points
  
  

This is the 1σ range (68% probability). For a wider 95% confidence, just double these numbers.

4. How traders use VIX

A) Interpreting levels

• VIX < 12 → Options cheap, low fear → good time to buy options if you expect a move.

• VIX > 20 → Options expensive, high fear → good time to sell options if you expect stability.
  
  

B) Common strategies

1. Low VIX (calm market):

   • Buy ATM straddle or strangle → Profits if breakout happens.

   • Example: Buy 24,000 CE + 24,000 PE when VIX is low.
     
     

2. High VIX (fearful market):

   • Sell strangle/straddle or use iron condor → Benefit from expensive premiums and IV drop.

   • Example: Sell 24,000 CE + 24,000 PE, hedge with far OTM options.
     
     

3. Event play (budget, elections, Fed meeting):

   • VIX rises → Buy options early.

   • After event → Sell options (IV crush).
     
     

4. Portfolio hedge:

   • If VIX very low → Buy Nifty Puts for cheap insurance.

   • If VIX very high → Sell covered calls to earn rich premiums.
     
     

5. Key takeaway

• India VIX = annualized expected volatility from Nifty options.

• Convert it into expected moves using √time formula.

• Use it to judge whether options are cheap (buy) or expensive (sell).