Low risk, low volatility.

"Six years ago, only one in 14 Indian households channeled their savings into the stock market - now it's one in five." But, "For six months, Indian markets have slid as foreign investors pulled out, valuations remained high, earnings weakened and global capital shifted to China - wiping out $900 billion in investor value since their September peak." "The number of Indians investing through SIPs (Systematic Investment Plans) has soared past 100 million, nearly trebling from 34 million five years ago." BBC. "So, is there blood on the streets?" asked Somnath Mukherjee. Nope. "Stretch that back three years, investors are up 11% p.a. on Nifty 50 and nearly 13% p.a. on Nifty 500." The real problem is the excessive "supply of new paper - via IPOs, QIPs, promoter and PE sales." So, this is only reversion to mean. The big red flag is that "Promoters of Nifty 50 firms are offloading their stakes at an unprecedented pace, with ownership sinking to a 22-year low of 41.1% in the December quarter, according to NSA data." "The timing is telling: promoters sold as stock valuations soared to record highs, cashing out before the market corrected." ET. They must have known their earnings were going to fall. "In India's case, much of the stock market rally between April 2021 and September 2024, when prices peaked was driven by retail investors, particularly those investing in equity mutual funds through the SIP route." "So, the individual rationality of investing in stocks through SIPs led to the aggregate irrationality of making Indian stocks overvalued." This is the 'fallacy of composition', wrote Vivek Kaul. "In the recent market decline, 1% of stocks have experienced catastrophic losses exceeding 80%, while another 59.7% have seen declines of 25-50%. Alarmingly, 8% are now trading below the March 2020 lows, signalling erosion of stock market confidence." However, "The Vix, measuring 30-day implied volatility, currently sits below 14, implying a period of reduced perceived risk." HT. Is this calm because promoters and large brokerage houses have booked their gains at the cost of retail investors? "RBI data showed outward foreign direct investment in equity from India in April-January at $11.3 billion, against $7.7 billion in the same period a year ago." The Chief Economic Advisor V Anantha Nageswaran called for more investments within India, saying, "the required growth rate of 7.6% in the March quarter for India's economy to achieve a growth of 6.5% for the full financial year was not unrealistic." man.com. On 1 January, "A bunch of top companies is hanging on to almost Rs 1 trillion of free cash that it has yet to find a use for, according to an analysis by a proxy advisory firm," wrote Nehal Chaliawala. Companies are not investing. Their owners are selling out. Individuals are left with dud investments. If this is 'reversion to mean' then India's mean is very low indeed. Hence, everything is calm.