What is Nifty Fifty?
What are the advantages and disadvantages of investing in it?
Nifty Fifty is owned by NSE Indices Limited, a subsidiary of the National Stock Exchange of India (NSE). The company operates more than one hundred equity indexes in addition to the Nifty Fifty. Nifty Fifty is a sum of fifty large cap stocks. It operates on the basis of free float market capitalization. It was listed on the Indian Stock Exchange on April 1, 1996. It is a general index like Sensex which covers 13 sectors of Indian economy. It is possible to track the market performance of 50 active companies simultaneously.
These 50 companies in 2022 are:
1. HDFC Bank Ltd. (Banks)
2. Reliance Industries Ltd (Petroleum Products)
3. Housing Development Fin. Corp Ltd. (Finance)
4. Infosys Limited (Software)
5. ICICI Bank Ltd (Banks)
6. Tata Consultancy Services Ltd (Software)
7. Kotak Mahindra Bank Limited (Banks)
8. Hindustan Unilever Ltd ( Consumer non durable)
9. ITC limited (Consumer non durable)
10. Axis Bank Ltd (Banks)
11. Larsen and Toubro Ltd (Construction project)
12. Bajaj Finance Ltd (Finance)
13. Bharti Airtel Ltd (Telecom services)
14. Asian Paints Ltd (Consumer non durable)
15. State Bank of India (Banks)
16. Maruti Suzuki India Ltd. (Auto)
17. HCL Technologies Ltd (Software)
18. Mahindra& Mahindra Ltd (Auto)
19. Nestle India Ltd (Consumer Non durable)
20. Dr. Reddys Laboratories Ltd (Pharma)
21. Titan Company Ltd (Consumer durables)
22. Sun Pharmaceuticals Industries Ltd (Pharma)
23. UltraTech Cement Limited (Cement)
24. Tech Mahindra Limited (Software)
25. Bajaj Finserv. Ltd (Finance)
26. Wipro Limited (software)
27. HDFC Life Insurance Company Limited (finance)
28. Power Grid Corporation Of India Ltd (Power)
29. Indusind Bank Limited (Banks)
30. Divis Laboratories Ltd (pharma)
31. NTPC Ltd (Power)
32. Tata Steel Ltd (Ferrous Metals)
33. Britania Industries Ltd (Consumer non durable)
34. Bajaj Auto Ltd. (Auto)
35. Hero Moto Corp Ltd (Auto)
36. CIPLA Limited (Pharma)
37. Eicher Motors Ltd (Auto)
38. Grasim Industries Ltd (Cement)
39. JSW Steel ltd (Ferrous Metals)
40. SBI Life Insurance Company Ltd. (Finance)
41. Shree Cement Ltd. (Cement)
42. Tata Motors Ltd(Auto)
43. Adani Ports & SEZ (Transportation)
44. Bharat Petroleum Corporation Ltd (Petroleum Products)
45. Oil and Natural Gas Corporation Ltd (Oil)
46. Coal India Ltd (Minerals/mining)
47. UPL Ltd ( Pesticide)
48.Indian Oil Corporation Ltd (Petroleum Products)
49. Hindalco Industries Ltd (Metals)
50. Tata Consumer Products (Consumer )
The Nifty is restructured in March and September each year. This restructuring process checks the stock quality of the companies every six months, It is decided to add or exclude a new company.
Advantages and disadvantages:
1) The biggest advantage of investing in Nifty Index Fund is, You can become a partner in the shares of fifty reputed companies by investing an amount according to your budget every month, Where the value of individual shares of those companies may be so high that you can not afford.
2) Since there is no direct intervention of the fund manager, You have to bear the minimum maintenance charge.
3) The investment process here is flexible That means you can increase or decrease the amount whenever you want, That benefit is not available in most funds.
4) One of the disadvantages of investing here is, If you invest for two or three years,
The desired result is not available. If you invest in Nifty Fifty for a long time, the return is much better (approximately 13% per annum).
To invest in Nifty 50, You need to open a DEMAT account And must have a trading account with a stockbroker.