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Table of Contents
How Nifty is calculated?
While watching the TVs. or reading newspapers or any news, often we all of watch a waving lines which are sometimes going up and sometimes going down. You know what? This waving line is called as Nifty.
Do you know what the meaning of nifty and what nifty’s value tells about it? We all should know it works and also know about what does make the differences of when it’s going down and up.
Peoples are also thinking about the How Nifty is calculated? So now we will know about it in full detail.
What Is The Meaning Of Nifty?
Nifty was launched in 1994, it is known with another name that is National Fifty just because it is made with the addition of two words. You know what, National Stock Exchange Fitty is the full name of Nifty.
We tell you about, any listed companies in the Nifty, when its share prices are mostly buying then its value is going up and when its share prices are mostly sold then its value is going down.
(How Nifty is calculated? What is Nifty50?
As we already told you, there are a total of 5o companies included in Nifty and which indicated its main 5o companies shares. This is to index the included companies into the National Stock Exchange. A total 1600 companies are included into National Stock Exchange, but among them, few companies are going to be selected, which is more financial compulsion and best marketing cap providing.
Few main companies which are selected for Nifty like, Media, Technical Information, Real Estate, Pharma, Auto, Financial Service, Bank, Energy, and many more.
How Does The Nifty work? How Nifty Is Calculated?
NSE is India’s most prominent Stock Exchanger and this is also a fully computerised type of Stock Exchange.
Nifty is the index of National Stock Exchange, and hence we told you only top 50 companies are kept in Nifty which are comes from 12 different sectors.
You will be shocked to know this, these all of 50 companies cover 60% of their market cap view. Therefore, the condition of the entire market is indicated only by the movement of the shares of these total 50 companies.
Maybe you know that there are 2000 companies listed in the NSE but it is impossible to keep track of all these companies at once.
How Nifty is Calculated?
This is too easy to calculate the Nifty, we tell you nifty is calculated the same as the sensex are calculated. You need to take some care and relax during the calculation of nifty, we tell you, during calculation of nifty, you have to suppose its base year as 1995 and its Base index as 1000.
You must have to know about Market Capitalization and Free Float Market Capitalization before calculation of the Nifty.
Market Capitalization- Market cap describes the total value of the company, which is obtained by multiplying the current or recent share prices of a company by all the available shares of that company. You can use this formula for this special calculation.
Market Capitalization’s Formula- Total Numbers of shares which are issued by company x Current or recent share prices of one share.
Free Float Market Capitalization- We tell you the type of this market, those shares are going to be multiplied by the current or recent share price which is available for buying and selling of shares.
You can use this formula for this special calculation.
Free Float Market Capitalization’s Formula- Total numbers of shares which are available for trading x Current or recent share price of one share.
Nifty Calculation- During the calculation of Nifty you have to mix up top 50 Free Float Market Capitalization companies and then multiply by 1995 with Nifty index 1000.
You can use this formula for this special calculation.
Nifty Calculation Formula- Some number of Free Float Market Capitalization x
Total of Index Value into 1995 and Divide by Market Capitalization 1995.
(How Nifty is calculated?)
How Bank Nifty is Calculated?
India’s 12 biggest, best and trustable banks are selected to make an index that indicates these banking sectors as high or low. In 2000 Indian Index Service Limited launched the bank nifty facility into the share market. A total of 12 banks were included for bank nifty.
12 Bank names which is selected for Bank Nifty-
- HDFC BANK
- ICICI BANK
- CANARA BANK
- RBL BANK
- INDUSIND BANK
- KOTAK MAHINDRA BANK
- BANDHAN BANK
- FEDERAL BANK
- BANK OF BARODA
- PUNJAB NATIONAL BANK
- IDFC FIRST BANK12– AXIS BANK
What are the differences between Sensex and
Nifty?
We tell you, Sexsex and Nifty is the index of share markets which works to tell us marketing up and down. Sensex (Bombay Stock Exchange) works to keep tracking of their top 30 companies. But here Nifty ( National Stock Exchange) works to keep tracking of their top 50 companies. You will be shocked to know this, Nifty is known as most trustable just because of their big market capitalization.
(How Nifty is calculated?) Benefits of Nifty?
- Nifty provides accurate information of related share markets that help the investors.
- Nifty tells us about the country’s economic status, if the nifty is going up then that indicates the country’s economy is strong.
- We tell you all eyes of the whole world is on India, because when the nifty and sensex are going up then foriegn investor also invest with it that work for make country’s economy strong.
- Nifty can provide few employment in future, if the nifty going up it indicates the included companies are growing up also.
Frequently Asked Questions (FAQs)-
How many share markets in India?
There are a total 21 stock exchanges in India, we tell you that, Bombay Stock Exchange and National Stock Exchange is the biggest share market in India among these 21 stock exchangers.
Where is the headquarters of the National Stock Exchange?
We tell you the headquarters of NSE is in the South Mumbai town that name is Varli.
How to see a share market chart?
If you are looking to see a share market chart then you have to visit any platform, here we will tell you, you can visit on Tradinview.com website, you can see the share market accurate chart and analyse it also.
How to start online trading?
If you really want to trading then you must have follow this, like you must have a demat account and savings account and last you have to link these with a trading application.
How many kinds of Trading?
We tell you that, a total of four types of trading are found in the stock market like Intraday trading, Swing trading, Short term trading and Long term trading.
Conclusion
So hello my reader, we hope you have understood this information clearly. We have tried to give you every smallest point that helps you to understand it easily, and we promised that if you read the above information from start till the end then you definitely will be able to apply it. In this article we have defined the Nifty and its related more queries. Please share this information to your friends and relatives.
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