The aversion to risks is steadily reducing in the stock market, which had surged to the highest levels in over a decade in March following the COVID-19-related worries. The Volatility Index (VIX) — a measure of options traders’ perception of near-term risks — has fallen to 25.77 on 3rd July, its lowest since March 6, from 86.6 on March 24 as the rebound in the markets aided by softer concerns over the pandemic made investors and traders return to Dalal Street. The index is, however, still above its average range of 13 to 20 — the levels within which it mostly moved in the years earlier.
Brokers say the risk appetite is treading its way back as global markets have rallied on liquidity support from central banks, improvement in some economic indicators and strong participation from retail as well as high net-worth investors.
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