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Today we will know what Nifty is (What is Nifty )? How it works and how it is calculated?
You must have often seen nifty on TV, news and newspapers so many points went down so high but do you know what the value of nifty tells us.Why should we know about it? What difference does it make to go down on top of it? So let's know in detail what nifty is ?
Contents value
- What is Nifty ?
- How Nifty Works
- How is Nifty calculated ?
- What is the difference between Nifty and Sensex ?
- Benefits of NIFTY
- Nifty Listed (List of Nifty 50 Companies)
- Conclusion
What is Nifty?
Nifty is full form National Stock Exchange Fifty and is also known as National Fifty as it is made up of two words National and Fifty.
Nifty keeps an eye on 50 companies Top listed in 50 NSE (National Stock Exchange) and is an index of 50 companies heading NSE that make us aware of the market situation.
It monitors the boom and slowdown on those 50 shares and produces its index value based on them. Companies selected in NIFTY 50 have more Market Capitilization than other companies and are taken from 12 different sectors.
How Nifty Works?
National Stock Exchange is a major stock exchange in India which is also India's first fullly Computerized stock exchange. More than 2000 companies are listed in the National Stock Exchange. It is quite difficult to keep an eye on more than 2000 companies at a time.
Nifty NSE is a index and therefore, only 50 top companies are placed in the Nifty which are from 12 different sectors.
Note: Nifty 50 companies are selected by Index committee This committee includes banks, governments, mutual fund managers and economists.
These 50 companies make up 60% of the entire market in terms of their market cap. Therefore, the situation in the entire market is known only by the movement of shares of these companies.
Nifty looks at the shares of these 50 companies. When these shares go up, the value of the NIFTY index also goes up and goes down under adverse circumstances.
How is Nifty calculated?
Nifty counts just like the Sensex count, it takes Base year 1995 and the Base index is considered to be 1000|
What is the market cap (Market Capitalization) and free float market cap (Free float Market Capitalization) before you calculate nifty? You have to know.
The market cap represents the total price of the company which Multiply the current share price of a company from all available shares of the company.
Suppose a xyz company has a current price of Rs 100, and the total share of that company is 10000, its market cap becomes 100*10000=Rs 1000000
Market Capitalization = Total no. of Shares issued by a Company × Current Share Price of One Share
Let me tell you that a company has a variety of investors, among them promoters whose shares are not sold and bought in the market. In a free-float market cap, shares that are available to buy and sell shares are Multiply the price of existing shares.
What is the difference between Nifty and Sensex
Both nifty and sensex are stock market indices that reflect the market boom and slowdown|
While the Sensex keeps an eye on 30 companies listed on Bombay Stock Exchange, nifty keeps its eye on the top 50 companies in the National Stock Exchange. Nifty is considered more confident due to high market cap. Both these indices are being monitored by the whole world and foreign investors also grow as they grow.
Benefits of NIFTY
Through NIFTY, the investor gets the right information about the market.
With the help of which he can enter or exit in the market if his investment is in Large Cap.
If the NIFTY index is growing, it means the company is growing well and employment is expected to grow in the future.
Nifty makes it easier to know the economy of the country If nifty is going up, the economy of the country also strengthens.
The whole world is watching the Indian market and when nifty, sensex goes up, foreign investors also invest their money in the Indian market which strengthens our economy and also increases the market cap of companies.
Conclusion
Today, we learned what nifty is works. Infect, Nifty is also an indicator of India's semi-personality, only then does the whole world keep an eye on it|
I hope you understand our post today. If you have a question or suggestion, you must have commented and told us |
Hi , This is Pramod Choudhary from Nagaur Rajasthan India. I an student and I would like to share my positive thinking with everyone that's my passion . Thank you
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