InvestorQ : How is the VIX structured and how is it measured?
sarah Leo made post

How is the VIX structured and how is it measured?

Answer
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Arusha Ray answered.
2 years ago


VIX or volatility index is a measure of volatility that is implicit in the market. It is a measure of the perception of risk in the stock markets. A higher level of VIX means that there is more risk perception or fear in the market and vice versa if the VIX is lower. That is why the VIX is also referred to as the Fear Index. The India VIX is an index based on the Nifty index option prices. From the best bid-ask prices of Nifty option contracts the volatility figure (%) is calculated which indicates the expected volatility over the next 30 days. This method is borrowed from the Chicago Board of Exchange (CBOE), which originally used this methodology to calculate the volatility