Full form of Nifty : NIFTY (“National Stock Exchange Fifty”)
NSE and BSE are two big exchanges in Indian stock market.
Nifty 50 is the flagship index of NSE (National Stock Exchange). The index is set of Top bluechip companies in its portfolio, the largest and most liquid Indian securities which are 50 out of approx 1600 stocks traded on NSE.
Nifty 50 covers approx. 65% of float adjusted market capitalization of NSE.
Since April 1996, NSE Indices Ltd manages Nifty50 Index.
List & weightage of Stocks in Nifty50 in 2020
|Reliance Industries Ltd.||Petroleum Products||13.24%|
|HDFC Bank Ltd.||FINANCIAL SERVICES||10.25%|
|Housing Development Finance Corporation Ltd.||FINANCIAL SERVICES||6.87%|
|Tata Consultancy Services Ltd.||IT||5.58%|
|ICICI Bank Ltd.||FINANCIAL SERVICES||5.40%|
|Kotak Mahindra Bank Ltd.||FINANCIAL SERVICES||4.52%|
|Hindustan Unilever Ltd.||CONSUMER GOODS||3.69%|
|ITC Ltd.||CONSUMER GOODS||2.88%|
|Axis Bank Ltd.||FINANCIAL SERVICES||2.43%|
|Larsen & Toubro Ltd.||CONSTRUCTION||2.26%|
|Bharti Airtel Ltd.||TELECOM||2.08%|
|Asian Paints Ltd.||CONSUMER GOODS||1.99%|
|Maruti Suzuki India Ltd.||AUTOMOBILE||1.85%|
|HCL Technologies Ltd.||IT||1.82%|
|Bajaj Finance Ltd.||FINANCIAL SERVICES||1.75%|
|State Bank of India||FINANCIAL SERVICES||1.45%|
|Nestle India Ltd.||CONSUMER GOODS||1.22%|
|Dr. Reddy’s Laboratories Ltd.||PHARMA||1.18%|
|Mahindra & Mahindra Ltd.||AUTOMOBILE||1.13%|
|UltraTech Cement Ltd.||CEMENT||1.05%|
|Sun Pharmaceutical Industries Ltd.||PHARMA||1.00%|
|Tech Mahindra Ltd.||IT||1.00%|
|Titan Company Ltd.||CONSUMER GOODS||0.97%|
|HDFC Life Insurance Co.||FINANCIAL SERVICES||0.93%|
|Power Grid Corporation of India Ltd.||ENERGY||0.87%|
|Britannia Industries Ltd.||CONSUMER GOODS||0.82%|
|Divi’s Laboratories LTD||PHARMA||0.80%|
|Bajaj Auto Ltd.||AUTOMOBILE||0.75%|
|Hero MotoCorp Ltd.||AUTOMOBILE||0.72%|
|Bajaj Finserv Ltd.||FINANCIAL SERVICES||0.67%|
|IndusInd Bank Ltd.||FINANCIAL SERVICES||0.66%|
|Tata Steel Ltd.||METALS||0.62%|
|Grasim Industries Ltd.||CEMENT||0.61%|
|JSW Steel Ltd.||METALS||0.61%|
|SBI Life Insurance Co.||FINANCIAL SERVICES||0.60%|
|Shree Cement Ltd||Cement||0.58%|
|Eicher Motors Ltd.||AUTOMOBILE||0.58%|
|Bharat Petroleum Corporation Ltd.||ENERGY||0.57%|
|Adani Ports and Special Economic Zone Ltd.||SERVICES||0.52%|
|UPL Ltd.||FERTILIZERS & PESTICIDES||0.50%|
|Hindalco Industries Ltd.||METALS||0.50%|
|Coal India Ltd.||METALS||0.48%|
|Oil & Natural Gas Corporation Ltd.||ENERGY||0.47%|
|Tata Motors Ltd.||AUTOMOBILE||0.47%|
|Indian Oil Corporation Ltd.||ENERGY||0.40%|
|GAIL (India) Ltd.||ENERGY||0.31%|
NIFTY50 Index Funds
NIFTY 50 Funds basically invest in these Nifty 50 Companies in Nifty weightage to get the benefit of appreciation in these Top quality stocks, they offers:
As the index consists of stocks from 17 different sectors it is worth to invest in Nifty 50 traded fund. It reduces the dependency on a particular sector. So diversification problem is solved in this way and an investors will be investing in the economy on the whole.
The index fund mirrors the returns that the index generates, so it reduces the cost of fund management. The returns over any period of time will be almost similar to Nifty. The role of the fund manager in the selection of stocks, industries etc. is non-existing.
Reduced Fund Manager Role
Some fund manager will be able to call the shots right while many of them could take a wrong call as well. Index funds are for those who do not wish to rely on the fund manager’s instincts and research rather ready to settle with market returns.
Nifty 50 Means “National Stock Exchange Fifty”
Nifty 50 Index is re-balanced twice in a year with cut-off date on January 31 & July 31 of each calendar year after giving Four weeks prior notice to market from the date of change.
NIFTY 50 is wholly managed by India Index Services and Products Limited (IISL), a subsidiary of NSE Limited, IISL focuses on the index as a core product through a professional team who manages NIFTY 50 Index along with 67 other indices coming under the NIFTY.