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Open
24965.8
Prev. Close
24980.65
| Company | Market Cap | Market Price | Sector |
|---|---|---|---|
1,17,801.59 | 615.85 -10.50 (-1.68%)▼ | Finance | |
2,57,811.77 | 692.10 -8.15 (-1.16%)▼ | Automobile | |
5,60,715.07 | 891.15 -11.15 (-1.24%)▼ | Finance | |
2,77,808.14 | 374.05 -6.00 (-1.58%)▼ | Aerospace & Defence | |
3,15,120.72 | 1,954.60 -17.60 (-0.89%)▼ | Finance |
What is the Nifty 50?
The Nifty 50 is the flagship benchmark index of the National Stock Exchange (NSE) of India, representing the weighted average of 50 of the largest and most liquid Indian companies listed on the exchange. Launched in April 1996 with a base value of 1000 and a base year of 1995, the index covers 13 sectors of the Indian economy, including financial services, information technology, energy, and consumer goods, making it a diverse and comprehensive indicator of the Indian stock market’s overall health.
The index is widely used by investors, fund managers, and analysts to gauge the market’s performance and as a base for various investment products such as index funds, exchange-traded funds (ETFs), and derivatives. The Nifty 50 is maintained by NSE Indices Limited and is reviewed semi-annually to ensure it remains representative of the market’s leading companies. Its composition and performance serve as a barometer for the Indian economy, helping both domestic and international investors make informed decisions.
What is the stock selection process for the Nifty 50?
The selection of stocks for the Nifty 50 index follows a rigorous and transparent process managed by NSE Indices Limited.
- Only equity shares listed on the NSE are considered.
- Stocks must have high liquidity, which is measured by their average impact cost; only those with an impact cost of less than 0.50% over the past six months are eligible.
- Companies must be part of the Nifty 100 universe and have a minimum listing history of six months, except in cases of large recent IPOs that qualify based on market capitalisation.
- The index gives preference to companies with a high free-float market capitalisation, ensuring that only widely held and frequently traded shares are included.
- The index also aims to reflect the sectoral balance of the Indian economy.
- The Nifty 50 is reviewed and reconstituted semi-annually, with changes announced in advance to ensure transparency and provide time for investors like you to adjust their portfolios accordingly.
How is the Nifty 50 value calculated?
The Nifty 50 index value is calculated using the free-float market capitalisation-weighted method. This means the market capitalisation of each of the 50 constituent companies is determined by multiplying their share price by the number of shares readily available for trading (free float). The total free-float market cap of all 50 companies is then divided by a predetermined index divisor to arrive at the Nifty 50 value. This calculation methodology ensures that the index reflects only the market movements of shares that are actively traded.
Nifty 50 FAQs
What is the Nifty 50?
The Nifty 50 is the benchmark equity index of the National Stock Exchange (NSE) of India, comprising 50 of the country’s largest and most actively traded companies across various sectors. It serves as a key indicator of the Indian stock market’s performance and overall economic health, helping investors like you make informed decisions.
How to invest in the Nifty 50?
You can invest in the Nifty 50 through index funds or exchange-traded funds (ETFs) that mirror the index’s composition. To do so, open a demat and trading account with a registered broker or an investment platform, select a Nifty 50 index fund or ETF, and invest either through lump sum or systematic investment plans (SIPs).
How is the Nifty 50 calculated?
The Nifty 50 is calculated using the free-float market capitalisation-weighted method. This means that the current index value is derived by dividing the total free-float market capitalisation of its 50 constituent companies by a fixed base period divisor, ensuring the index reflects only actively traded shares.
How many companies come under the Nifty 50?
As the name suggests, the Nifty 50 index consists of exactly 50 companies from various sectors of the Indian economy. These companies are selected based on strict eligibility criteria related to market capitalisation, liquidity, and trading history, making the index a broad representation of the Indian equity market.
Can I buy the Nifty 50 in Kotak Securities?
Yes, you can invest in the Nifty 50 through Kotak Securities by purchasing Nifty 50 index funds or ETFs available on its trading platform. Simply open a demat and trading account with Kotak Securities, search for Nifty 50-based investment products, and start investing per your financial goals.