Volatility Index at 2-year low

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The India VIX index, Dalal Street's fear gauge, closed at a two-year low on Wednesday at 13.06, the lowest since October 22, 2012. A low reading signals the market doesn't expect any huge fluctuations either on the upside or the downside.

"People are convinced about the market momentum. There will be interim blips, but the Nifty is expected to continue its upward journey in the next one year. There are a lot of buyers waiting on the sidelines, who will provide support whenever the market corrects," said Yogesh Radke, head of quantitative research at Edelweiss Capital.

According to Siddarth Bhamre, head - equity derivatives at Angel Broking, the drop in the index level is due to thin participation. "Volumes are not as high as they were in the last few months. Similar VIX levels on the back of high volumes could have provided more credibility," said Siddarth Bhamre, head - equity derivatives at Angel Broking.