The Nifty 50 also known as National Stock Exchange 50 is a diversified index containing 50 stocks from over twelve sectors of the economy. In India, the Nifty 50 index is considered the benchmark index for the stock market.
Nifty 50 can be a good investment proposition for people who want to invest in stocks with high growth potential of India’s top-ranked firms. Know in detail what is Nifty 50 and how to invest in it.
Nifty 50 is NSE's flagship index that includes the top 50 listed companies out of 1600 that are traded on the stock market. The Nifty 50 Index is operated and jointly owned by India’s leading index company, the NSE Indices Limited. It not only provides investors and traders access to cost-effective but also long-term growth potential.
The shares that comprise the Nifty 50 have been chosen based on factors including, but not limited to, liquidity and sector weights, as well as the overall market capitalization. Tracking the Nifty 50 share price helps investors and traders measure the overall performance of the stock market.
Following are a few ways and steps you can follow to invest in Nifty 50 stocks:
If you want to be more actively involved, you can directly invest in the stocks that form the Nifty 50 index. However, it entails more stock price assessment and tracking portfolio. Before investing in individual stocks, you must make sure that you study each company’s balance sheets, growth and risks.
For investors who cannot actively manage their investments but wish to invest their funds in the Nifty 50, an index fund that is tied to the Nifty 50 is the most direct way. Popular Nifty 50 index funds are Nifty 50 Index Fund, Mirae Asset Nifty 50 Index Fund, Kotak Emerging Equity Fund and others.
ETFs give investors and traders an opportunity to own and trade in Nifty 50 stocks through trading on an ETF that mirrors the index. The key benefits of ETFs comprise diversification, lower prices, and high marketability. The top Nifty 50 ETFs are the Parag Parikh Flexi Cap Fund, ICICI Prudential Nifty Index Fund, and Motilal Oswal S&P 500 Index Fund.
Stock investors can directly get exposure to Nifty 50 stocks through derivative segments including futures and options. These instruments enable the trader to make a forecast on the future direction of the index or the constituent stock with a view of profiting when the price rises and or falls. However, trading derivatives is fairly risky and an investor has to know about several markets.
The Nifty 50 index accounts for a good part of the stock market. Knowing how to invest in Nifty 50 offers you access to safe, diversified and low-cost investment opportunities. This is because you are investing in some of the country’s best companies from the top industries.
To avail lucrative returns on your investments,
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