This list is reviewed every six months when companies are removed and added to the index. Listed for at least six months (or if it just had an IPO, then listed for at least one month).Should be available in the futures and options (F&O) segment to trade.have sufficient traded volume using a more detailed criteria. Apart from that, stocks should also fulfill the following criteria: Then picks the top 50 to be part of the index. The NSE ranks companies by free-float market capitalization (free float essentially means shares available for the general public to buy and are not locked in). To put this in perspective, some of the companies in the NIFTY 50 Index are Infosys, Reliance Industries, HDFC Bank, ITC, Asian Paints, etc. Most NIFTY 50 companies exhibit a strong balance sheet, robust growth numbers and an expansive global footprint. Then, in 1996, the NIFTY 50 took on additional meaning when the NIFTY 50 Index appeared on the National Stock Exchange of India and became a staple feature of the Indian stock market.
Companies such as Coca-Cola, Xerox and IBM are examples of the NIFTY 50 stocks that investors didn’t need to think twice about before buying. These stocks were regarded as sure-shot quality buys or blue-chip stocks that were best-in-class and traded at high valuations.
History of the NIFTY 50īack in the 1960s and 1970s, NIFTY 50 referred to the fifty most popular large cap stocks on the New York Stock Exchange. For foreign investors tracking the Indian markets, their first reference point is NIFTY movement and their first few investments in India are usually in NIFTY stocks. This further means the weighted average performance of those 50 stocks was up. The other is the Sensex – a similar index of 30 stocks managed by the Bombay Stock Exchange (BSE).Įven though there are 1,300 stocks listed on the NSE, when someone says “the market was up today”, they usually mean the NIFTY 50 index was up. It is one of the two most referenced barometers used by investors to track how the “stock market is doing”. The NIFTY 50 is an index of the country’s top 50 companies by market capitalization that are listed on the National Stock Exchange (NSE). Below is a breakdown of its significance and ways to start investing in NIFTY 50 stocks.
However, for novice investors and those who are uninitiated into the world of finance, NIFTY 50 could come across as just another finance jargon. A staple across financial papers and news about stock markets in India, the term “NIFTY 50” is ubiquitous in its presence.
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