The India Volatility Index, or India VIX, commonly known as the “fear index,” is close to a 20-month low, indicating that investors are bullish in their outlook for the stock market.

The reason VIX is called the “fear index” is because it is a measure of the expected volatility in the index over the next 30 days. Simply put, it reflects the market's expectation for how much an underlying asset will fluctuate, based on the prices of options contracts traded on the asset.

Last week, the India VIX fell to 11.79 points, the lowest level since July 2021. So far in April alone, the VIX has fallen 20 percent.

A low VIX reading is generally interpreted as a sign of investor confidence and market stability whereas a high VIX generally indicates that investors are worried about big price moves on the downside.