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Date of posting: Friday, 02-May-2025
The rising India VIX is indicating a fall in the Nifty. However, the tariff news is not coming at least for the next 60 days, so do not worry. Read why the Sensex is rising and is expected to rise.
India VIX 02-May-25
So, there could be other reasons why India VIX is increasing. One of them is the confusion over Traffis, and the other is the tension between India and Pakistan.
Even though India VIX is inversely proportional to Nifty, sometimes the prevailing conditions are such that they both become independent.
What Traders Can Do When India VIX Is On The Rise
The increased VIX will give a benefit to longer-term option buyers as theta decay will be negated by the increasing VIX.
However, if you are an option buyer, it is suggested that you take out the profit between 10% and 20%, and not wait for a lucky draw. Lucky draw is just an imagination which never happens. Traders who wait for that lucky draw usually end up in losses.
Too many small profits are better than one big loss.
Currently, the option sellers will be having issues seeing no theta decay happening.
Option sellers can shift to weekly options, as due to the high INDIA VIX, they will get reasonable option premiums expiring in 5-7 days. Whatever the VIX, since weekly options do not have much time left, they will have a good theta decay speed no matter what happens to the VIX.
Of course, whatever you trade, do not trade without a hedge. One loss can take out years of profits. Hedge not only reduces the margin selling options and buying/selling futures, but also reduces the stress of losing a large capital overnight. Hedge makes sure there is never a huge loss.
You can do my monthly income options course and learn hedging options, futures and stocks.
Contact me if interested in doing the course.
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