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NIFTY is a prime index of the ‘The National Stock Exchange of India Limited’, the Mumbai based stock exchange. NSE is the largest stock exchange in India in terms of daily turnover and trading volume in both equity and derivative trading. NSE is owned by the premiere financial institutions, banks, insurance companies and other financial intermediaries in India. But the ownership and the management of the exchange work as separate entities. The NSE S&P CNX Nifty 50 that is popularly known as NIFTY is the key index of the NSE.
NIFTY is an index that is made of 50 major stocks listed at the NSE in terms of market capitalization. NIFTY is a well diversified index as these 50 companies are from 21 sectors. The index is owned and managed by India Index Services and Products Ltd. (IISL). IISL, which is a joint venture of NSE and CRISIL is the first specialized company in India on Index. The company has a marketing and licensing agreement with Standard & Poor's (S&P) - the world market leader in index services. The NIFTY index is used for different purposes like benchmarking fund portfolios, index based derivative trading and index funds.
NIFTY is one of the leading index in the Indian stock market and the prime index of the NSE. If you consider all the stocks in the NIFTY it accounts for almost 50% of the total traded volume in the NSE. These NIFTY stocks accumulatively represent about 58.64% of the total market capitalization as on 31st March, 2008. The impact cost of the S&P CNX Nifty index is 0.15% for a portfolio size of Rs.2 crore. The NIFTY index is professionally maintained by IISL which is the premiere index management company in India. The NIFTY index is ideal for derivative trading and huge number of investors trade in NIFTY derivatives on regular basis.
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