NIFTY stands for National Stock Exchange Fifty. It is not an individual stock but an index comprising top 50 largest companies in India traded in NSE that is about 65% of the total float-adjusted market capitalization of the NSE. There are many other types of indices based on NIFTY, apart from NIFTY 50.
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The NIFTY share price chart that shows the live market movement of NIFTY trend share price is updated in NSE.
Let us learn about the NIFTY share price chart in detail:
As indicated in the table in NSE live market indices, the Broad Market Indices are listed first. For e.g., NIFTY 50 , NIFTY NEXT 50, NIFTY 100, NIFTY 200, NIFTY 500 etc. There are several other categories of NIFTY Indices such as Sectoral Indices, Strategy Indices, Thematic Indices, and Fixed Income Indices.
For each of the index in a category, the opening price, the day’s highest price till now, day’s lowest price till now, change percentage are tracked live.
Apart from these, the closing price of the previous day, the day before, along with 1 week ago, 1 month ago and 1 year ago value of NIFTY share price are displayed in the NIFTY share price chart.
The NIFTY 50 chart when plotted gives a very detailed picture of the trend of NIFTY Indices that helps investors trade the derivatives such as NIFTY Futures or NIFTY Options.
Please note, you cannot buy NIFTY Indices. You can only invest in Derivatives, Index Exchange Traded Funds and Index Funds.
Composition of the NIFTY Indices:
The NIFTY Index, for e.g., the NIFTY 500 consists of top 500 companies based on full market capitalisation, under the specific Index category. The name of the Index itself gives a clue on the number of companies included in that particular index.
Every NIFTY Index is grouped under a common category for ease of tracking, comparison and trend analysis.
The NIFTY Index composition is not fixed which means, the actual list of companies that form part of an index can change. The composite list of companies is reviewed and changed based on a set period.
This period in which a NIFTY Index is reshuffled differs from one NIFTY Index to another.
For e.g., for NIFTY 50, it is twice a year based on data for six months ending January and July. So, some companies can be removed from an index or be include again based on its latest performance.
For NIFTY Dividend Opportunities 50 Index which falls under NIFTY Strategy Indices Category, it is once a year, based on data for six months ending January.
Every constituent company has to clear the Eligibility Criteria for each Index along with Constituent Capping which means there is a limit to the weightage given to a particular company included in an Index.
Calculation of NIFTY Share Price:
The bank nifty chart Share Price of NIFTY Indices is calculated based on two methods – Market Capitalisation and Equal Weight
Both the methods use weighted method based on constituent companies that are part of the index.
- Market Capitalisation based indices
Index Value = (Index Market Capitalisation / Base free float Market Capitalisation of Index) * Base Index Value
- Index Market Capitalisation = Shares outstanding * Investible Weight Factors * Capping Factor * Price
which is the aggregate of market capitalisation of each scrip in the Index adjusted for free float and/or capping factor.
- Base Index Value is the initial value assigned to an index.
- Equal Weight/Factor-based indices
Index Valuet = (Modified Index Capitalization/Index Divisort) * 1000
Modified Index Capitalization = Sum of (Modified Index Shares)i * Pricei
Modified Index Sharesi = (Weighti * Modified Index Market Capitalization) / Pricei Modified Index Sharesi (on Base date) = (Weighti * Base Index Divisor) / Pricei
In the above formula, Subscripts “t” is the time and “i” is the counter for each scrip