What is NIFTY?

Nifty is a combination of two words one is NSE (National Stock exchange) and other is Fifty.

Nifty is the benchmark index of Indian stock market. Also it is the weighted average of top 50 companies listed on Indian stock market from different sectors. But currently there are 51 stocks listed in Nifty. As of date 31 June 2022 the total market capitalization of all stocks in nifty is Rs 13,160,428.33,Cr.  Nifty is used in India and all around the world for tracking the performance of Indian stock market and Indian economy.

History of Nifty

Nifty was launched on 1996 as starting value of 1000. By the period of 25 years nifty has given huge returns to its investors. The highest value of Nifty is 18600. Nifty completed its landmark of 5000 in 2004 , 10000 in 2017 and 15000 in 2021 and heading towards the 20000. Stocks that are in nifty are called as Bluechip stocks . They are considered as most safe and trusted stocks in country.

 

Criteria to get into Nifty

In every six months stocks in nifty are revised , some stocks are added some removed. The standard criteria is as follows

1. Company must be an Indian company.
2. Stock of company must be highly liquid.
3. Company must be a listed company.
4. Company should be a Large Cap company.

Stocks with highest Weightage in Nifty

Top 5 stocks with highest weightage in nifty as of 31 May 2022 are

1. Reliance Industries – 12.86%
2. HDFC Bank – 8.10%
3. Infosys – 7,66%
4. ICIC Bank – 6.90%
5. HDFC – 5.39%

Sectors with highest weightage in Nifty

There are 13 sectors in Nifty and each sector has different weightage in market. The top 5 sectors contribute nearly 80% of weightage of nifty and the sectors are.

1. Financial Services – 38%
2. IT – 16%
3. Oil and gas – 12%
4. FMCG – 11%
5. Automobile – 5%

Nifty is a most traded index in India. Nearly 75% trading in india happens in Nifty 50 stocks.