In October, foreign institutional investors (FIIs) sold over ₹1 lakh crore in the cash segment of the derivatives market, indicating a bearish stance. They reduced their positions in index futures and increased their holdings in put options, reflecting a cautious outlook on market stability amidst rising volatility.
The NSE Nifty 50, the benchmark index, has declined by over 7% in the past month, dropping from its all-time high of 26,277 in late September to 24,341 on October 30. This decline is occurring amid concerns of overvaluation, coinciding with the upcoming US Presidential elections and the start of a new monthly derivatives series.
The differing strategies of FIIs and DIIs in the derivatives market highlight the mixed sentiment as they navigate the current economic landscape.