Nifty 50 Companies and It’s weightage.

The NIFTY 50 index is a well-diversified 50 companies index reflecting overall market conditions. NIFTY 50 Index is computed using the free-float market capitalization method.
NIFTY 50 can be used for a variety of purposes such as benchmarking fund portfolios, launching of index funds, ETFs and structured products.

Index Methodology

Eligibility Criteria for Selection of Constituent Stocks:
1. Market impact cost is the best measure of the liquidity of a stock. It accurately reflects the costs faced when actually trading an index. For a stock to qualify for possible inclusion into the NIFTY50, have traded at an average impact cost of 0.50% or less during the last six months for 90% of the observations, for the basket size of Rs. 100 Million.
2. The company should have a listing history of 6 months.
3. Companies that are allowed to trade in F&O segment are only eligible to be constituent of the index.
4. A company which comes out with an IPO will be eligible for inclusion in the index if it fulfils the normal eligibility criteria for the index for a 3 month period instead of a 6 month period.

Index Re-Balancing:
The index is re-balanced on a semi-annual basis. The cut-off date is January 31 and July 31 of each year, i.e. For a semi-annual review of indices, average data for six months ending the cut-off date is considered. Four weeks prior notice is given to market from the date of the change.
Index Governance:
A professional team manages all NSE indices. There is a three-tier governance structure comprising the Board of Directors of NSE
Indices Limited, the Index Advisory Committee (Equity) and the Index Maintenance Sub-Committee.

Facts as of 31st of March 2020

Her is the detailed breakdown of all the Nifty 50 companies. Sectoral weight-age has remained largely similar and the constituent companies have constantly changed.

1 : Financial Sector, Consumer Goods and IT Sector contribute 66% Weightage in Index.
2 : Financial Sector – 36.51% , Information Technology – 15.02, Consumer Goods – 14.46%.
3 : There are only 3 Pharmaceutical companies. India is amongst the biggest pharmaceutical exporters in the world.

SectorWeightage(%)
Financial Services36.51
Information Technology15.03
Consumer Goods14.46
Oil & Gas12.44
Automobile4.53
Telecom3.13
Construction2.79
Pharma2.72
Metals2.52
Power2.28
Cement & Cement Products2.22
Services0.54
Fertilisers & Pesticides0.50
Media & Entertainment0.32

Updated Date: 3rd of April 2020.

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