When you watch stock market news, you are told that Nifty has fallen by 70 points today or sometimes you are told that Nifty has increased by 100 points today, but what is this Nifty?
Whenever it comes to earning from the stock market, a new investor must have knowledge about Nifty50 and Banknifty. By looking at these two indexes, it can be found out which trend is going to run in the stock market today if this index is Bullish. So today Bullish momentum can be seen in the stock market and on the contrary, if this index is in Downtrend then Bearish Momentum can be seen in the market.
If an investor does not get information about these two indexes before investing in the stock market, then he can lose a lot in the stock market.
If you do not want to make your loss and want to know what is Nifty50, How Nifty 50 works, how to earn money from Nifty 50, how to invest in Nifty 50, difference between Nifty50 and Banknifty. So read this post till the end.
What is Nifty
You will be surprised to know that the full form of Nifty is National Fifty but almost all the investors call it by the word Nifty
but here is an interesting thing that 50 is used in front of it because it is the 50 best and market capitalized companies of the country. represents the value of shares
In the Indian stock market, the Nifty 50 includes the 50 best companies from 12 sectors of the country. The ups and downs in the companies are reflected in the Nifty 50 index.
If the new investor does not have much knowledge of the stock market, then He can invest in any company only among the companies of Nifty 50. This index proves to be very profitable for the new investor. Besides, you can also invest in Nifty 50 through ETFs.
How to invest money in Stock market
How does Nifty work
If a new investor wants to invest with the market trend, then he can invest in a good company by looking at the market trend by looking at the Nifty 50 index.
There are more than 7000 companies listed in Nifty, in which only the best 50 companies are visible in Nifty. If we look at the market capitalization of these top 50 companies of Nifty, it is equal to the market capital of thousands of other companies listed in the stock market because this is India. Is the most liquid company.
Liquid company means a company in which shares are bought and sold in large quantities. And you can easily buy or sell the stocks of these companies.
Nifty 50 is to provide information about the movement of NSE (national stock exchange) stock market.
Why was Nifty started
Nowadays shares are bought and sold online but in olden times there was no online facility so shares had to be bought and sold physically through brokers.
Till then there was only Bombay Stock Exchange (BSE) located in Mumbai through which we could trade shares.
That is why the government of our country decided that a new stock exchange should be created on which shares can be bought and sold online.
That is why the National Stock Exchange i.e. NSE was established and from then onwards NIFTY also started.
Nifty was born out of the need for an index that could provide a basis for measuring the performance of major companies in the Indian stock market.
It provides investors with an indication of how key areas of the market are performing.
What does Nifty50 mean
More than 1600 companies are listed in NSE (National Stock Exchange) but only the best 50 companies are listed in Nifty50. These companies belong to 12 different sectors which are at good positions in their respective sectors. it occurs
These 50 companies are selected by a committee of Nifty 50 officials. This committee includes members from the government, mutual funds, etc. By following the rules of all these officials, 50 companies are selected in Nifty.
When did Nifty start
Nifty 50 was launched on 1 April 1996. Its objective was to find out the performance of shares of best companies in the Indian stock market.
At that time its base value was kept at 1000 and today the value of Nifty is more than 19500.
What is the difference between Nifty and Sensex
Both Nifty and Sensex are major indices of the Indian stock market, but they measure companies in different ways. Nifty 50 includes the top 50 companies of India while Sensex includes the top 30 companies of India.
Nifty 50 is the index of NSE (National Stock Exchange) while Sensex is the index of BSE (Bombay Stock Exchange).
The full form of NIFTY is National Stock Exchange Index while the full form of SENSEX is Sensitivity Index because it reflects the sentiment of the market.
How does Nifty tell the condition of the entire stock market
If we look at the market capitalization of the top 50 companies in Nifty 50, it is equal to the market cap of thousands of other companies listed in the stock market because it is the most liquid stock company in India.
Liquid company means a company in which shares are bought and sold in large quantities. And you can easily buy or sell the stocks of these companies.
Nifty 50 includes shares of 50 best companies of India but this company belongs to 14 different sectors which are mentioned below.
1. Financial services (Banking Sector) |
| 2. Internet Technology (IT Sector) |
| 3. Energy (Oil, Gas, Fuel) |
| 4. Automobile |
| 5. Fast Moving Consumer Goods (FMCG Sector) |
| 6. Metals & Mining |
| 7. Healthcare |
| 8. Consumer durables |
| 9. Construction |
| 10. Telecommunication |
| 11. Construction materials |
| 12. Power |
| 13. Services |
| 14 chemical |
How to invest money in Nifty – How to trade in Nifty
To invest money in Nifty, you must have a demat account. to trade or invest in Nifty, you have to activate the Future and Options (F&O) segment in your broker app.
You cannot buy Nifty like a share because it is an index in which you only do future trading or option trading (F&O).
In NIFTY you cannot buy a single share, rather you have to buy shares according to the lot size. NIFTY has a lot size of 50 and you have to buy at least one lot.
If you want to invest money in Nifty and the premium price of a Nifty put or call option is Rs 100, then you will need to buy at least 50×100 = Rs 5000.
If you have bought a call option on Nifty, you will get profit only when the Nifty index goes up; But if you have bought put option, you will get profit only when Nifty index falls.
But the easiest way to invest in Nifty 50 is to buy NiftyBees ETF if you do not know option trading.
ETFs are exchange traded funds. You can buy shares of these mutual funds directly.
You can buy the ETF by searching for Nifty BEES, if you want. By doing this your money will be invested in Nifty index and you will join the growth of Nifty.
Which indices are formed by combining Nifty
Nifty is not the only index but many other indices are formed by combining it like this
- Nifty IT
- Nifty Bank
- Nifty FMCG
- Nifty Auto
- Nifty Pharma
- Nifty Oil & Gas
- Nifty Realty index
There are many Nifty indexes but among these, Bank Nifty index is the most popular which is traded by millions of people in the stock market every day.
NIFTY50 includes stocks of top 50 companies, similarly there are other indices like – NIFTY Next50, NIFTY100, Nifty200, NIFTY Midcap etc.
Which is NIFTY Next50, it contains 50 companies coming after Nifty50, Nifty100 contains the top 100 companies of the country and Nifty Midcap contains 500 medium sized companies.
Which is the best company in Nifty 50
The 10 companies included in Nifty 50 have a very important role. Come, let us know the 10 companies included in Nifty 50.
| Company and Sector | Weightage in Nifty in% |
| Reliance Industries Limited | 11.89 |
| Infosys Limited | 9.13 |
| HDFC Bank Limited | 8.43 |
| ICICI Bank Limited | 6.64 |
| HDFC | 5.66 |
| Tata Consultancy Services Limited | 5.07 |
| Kotak Mahindra Bank Limited | 3.37 |
| ITC Limited | 2.87 |
| Larsen & Toubro Limited | 2.79 |
| Axis Bank Limited | 2.63 |
What is the weightage of which sector in Nifty 50
| Sector Weightage | Weightage % |
| Financial Services | 36.81 |
| Information Technology | 14.70 |
| Oil , Gas & Consumable Fuels | 12.17 |
| Fast Moving Consumer Goods | 9.02 |
| Automobile and Auto Components | 5.84 |
| Metals & Mining | 4.02 |
| Healthcare | 3.91 |
| Construction | 3.29 |
| Consumer Durables | 2.85 |
| Telecommunication | 2.47 |
- Reliance
- TCS
- HDFC Bank
- Infosys
- HUL
- ICICI Bank
- HDFC
- SBI
- ITC
- Bharti Airtel
- LIC India
- Bajaj Finance
- Kotak Mahindra
- HCL Tech
- Larsen
- Axis Bank
- Maruti Suzuki
- Asian Paints
- Sun Pharma
- Avenue Supermarket
- Wipro
- Titan Company
- Bajaj Finserv
- UltraTech Cement
- Nestle
- ONGC
- Adani Enterprises
- Adani Total Gas
- JSW Steel
- M&M
- NTPC
- Adani Trans
- Power Grid Corporation
- Adani Green Energy
- Tata Motors
- Tata Steel
- Hind Zinc
- Coal India
- LTI
- Mindtree
- Pidilite Industries
- Vedanta
- SBI Life Insurance
- Britannia
- IOC
- Bajaj Auto
- Adani Ports
- Siemens
- Grasim
- HDFC Life
What is Nifty Meaning FaQ
National Fifty
You can invest money in Nifty through option and future trading, for this you have to buy serials of Nifty in lot size. Apart from this, you can also invest money in Nifty50 by buying Nifty bees ETF i.e. Exchange Traded Fund.
Shares and Nifty are both forms of financial markets, but Shares represent the ownership assets of a specific company, while Nifty measures the values of different companies.
Free-float market capitalization = value × equity × investable weighting factor
The top 50 companies of India are included in NSE 50 i.e. Nifty. Nifty50 index is made up of the 50 largest companies of the country. On the other hand, the top 100 companies of India are included in Nifty 100 and the top 500 companies of India are included in Nifty 500.
To trade in Nifty, you have to buy or sell Call and Put options at a certain strike price. In this way you can earn good money in Nifty.
Nifty means index of National Stock Exchange. Meaning Nifty 50 is a benchmark index of the stock market which shows the condition of the stock market.
Reliance Industries,TCS, HDFC bank etc.
Reliance Industries Company’s shares have the highest weightage (10%) in Nifty 50. After this come TCS, HDFC Bank and Hindustan Unilever.
Nifty is maintained by the NSE (National Stock Exchange), which is a major platform of the Indian stock market.
Yes, it is safe to invest money in Nifty 50 because by investing in Nifty you invest money in the Indian economy. Meaning, with the growth of our country’s economy, Nifty 50 also grows and we all know that India is a growing economy, that is why it is safe to invest in Nifty 50.
The stock market has many indices that measure market conditions and trends, such as Sensex, Nifty, Volume, etc.
| What is Nifty? | stock market index |
| Full form of nifty? | National Stock Exchange Fifty |
| How to buy Nifty? | By trading ETFs or options |
| How many companies are there in Nifty? | India’s top 50 companies |
| Whose index is Nifty? | NSE |
| When was Nifty 50 established? | 1 april 1997 |
| Nifty Base Year | 1995 |
| Nifty base value | 1000 |
Conclusion of Nifty 50 Meaning
In today’s post we discussed what is Nifty50. If you have also gained some information by reading this post. We have tried to tell you all the information related to Nifty50 in this article.
If you still have any question then you can ask in the comment section. We will be waiting for your loving comment.