≡ Menu

Why Nifty Is Rising Since Last One Year

Fill this Form to Get 5 Day Free Course on Options And Immediately Get an email to Download eBook on Option Greeks. You can also get an Equity Intraday Strategy for FREE

=====The Article=====

Article Date: Monday, 27 August 2018

Many traders and investors must be wondering why Nifty 50 (NSE) is rising continuously since last one year. Here is the chart:

NSE 24-Aug-17 to 24-Aug-18

52 Week High and Low:

Percentage Increase (20.39%):

Some important notes before you read further:

NIFTY 50 is a diversified 50 stock index accounting for 12 sectors of the economy. It is used for a variety of purposes such as bench-marking fund portfolios, index based derivatives and index funds. NIFTY 50 is owned and managed by NSE Indices Limited (formerly known as India Index Services & Products Limited) (NSE Indices). NSE Indices is India’s specialised company focused upon the index as a core product.

Source: https://www.nseindia.com/products/content/equities/indices/nifty_50.htm

Basically Nifty tracks the market performance of 50 largest cap companies’ stocks of india, and hence, broadly reflects the sense of the Indian economy.

Is NSE (National Stock Exchange) same as Nifty 50?

No. Nifty 50 is a collection of large cap or in other words very big companies which may not collapse. NSE is a stock exchange where thousands of companies stocks are traded – bought and sold. NSE has more than 1,600 companies listed on its platform. Nifty is a collection of 50 large companies which are traded in NSE.

Similarly BSE (Bombay Stock Exchange) is also a stock exchange just like NSE where shares can be bought and sold for companies listed there. There are about 5,000 listed companies in the BSE.

If you check the difference approximately 3000+ companies are not listed in NSE, hence not traded in NSE. Thousands of companies are listed in both BSE and NSE. If you want to buy stocks of a company listed in BSE but not listed in NSE – you have to buy from BSE exchange only and sell in BSE exchange only. You cannot buy a stock listed in BSE and sell in NSE, if not listed there.

Companies listed in both NSE and BSE can be bought from one exchange and sold in another and vice versa. But this cannot be done intraday. Means you cannot buy a share in BSE and sell in NSE and vice versa the same day. This is arbitrage and hence not allowed.

Full form of NIFTY is “National Stock Exchange Fifty”. When you want to see chart of NSE you will end up seeing charts of NIFTY everywhere. In fact you will see NIFTY being branded as The National Stock Exchange (NSE). Fact is NIFTY is only a part of NSE but index of NSE is calculated based on NIFTY, therefore when you search for chart of NSE you end up seeing chart of Nifty 50.

People get confused thinking its NSE chart. Market apps and websites show the Nifty 50 chart and brand it as NSE. It’s not wrong as Nifty 50 is most popular and most traded index derivative (future and option).

Now coming to the question of why NIFTY is rising since last one year. If the stocks in the Nifty 50 rise then NSE will also rise.

See list of stocks in NIFTY 50 that have risen the most in last one year (from Aug 2017 to Aug 2018):

Top Nifty 50 Companies Aug 2017 to Aug 2018

Source: https://economictimes.indiatimes.com/marketstats/company-true,exchange-50,indexid-2369,indexname-Nifty%2050,pageno-1,pid-37,sortby-yearlyPercentageChange,sortorder-desc.cms

Please note that by the time you see the list may change.

You can see that the top companies have risen approx 30-70%, but NIFTY has risen 20.39%. Why only 20.39%, why not 50%? Here are companies that gave a negative return in the same period in NIFTY 50:

Negative return companies NIFTY 50 Aug-2017 to Aug-2018

On top of that some companies are given more weightage in evaluating the price of NIFTY. So if all the averages are taken along with the weightages of these 50 companies you will see that it’s a 20.39% rise only.

Some more information on Nifty calculation:

Base year of NSE is 1995 and base value is 1000.20. NIFTY is calculated based on 50 stocks. List of 50 stocks can be found here.

The main difference between SENSEX and Nifty is that SENSEX is the stock market index for BSE Limited, while Nifty is the stock market index for National Stock Exchange (NSE). SENSEX is comprised of 30 stocks, while Nifty is comprised of 50 stocks.

What you should do now

1. If you have still not subscribed for my free 5 days course you can do by filling the form above. You will learn a lot about option trading.

2. If you are a new option trader, not much experienced and are making losses you can do my paid course. I recommend Nifty Conservative Option Course for beginners because it is easy to understand and easy to trade. Even a 18 year old young trader or a housewife can learn it and start trading from next day. It will help you to earn consistent monthly income without any software or speculation or stress or big risk. You will learn proper hedging strategies that works in any market condition.

3. If you are banknifty weekly options trader you can do my Bank Nifty Weekly Options & Futures Strategy Course. You will learn future and option hedging strategies that works in volatile market condition.

NOTE: Here is one more help. You can open a trading account in UPSTOX and send me a WhatsApp message on 9051143004. I will send you a FREE Equity Intraday Strategy that you can start trading and make approx 200 a day. You need 5000 to start trading this strategy.

CLICK HERE AND REGISTER IMMEDIATELY TO OPEN AN ACCOUNT IN UPSTOX. If you do not register immediately you will not be mapped under me which is very important to get the free strategy.

UPSTOX is a low cost broker where buying and selling of stocks is FREE.


What Traders Say About My Course

Course fees: Click here to know the course fees.

Here is complete process of my course

1. Once you pay I will send you the course materials for studying to your email.
2. You read and ask me questions via phone/whatsapp/email to clear doubts.
3. Then you start paper trading and still can ask me questions.
4. After about one month you can start trading.
5. Since doubts can come anytime the support will be there for one year.

Within one month you can start trading on your own. No need to depend on anyone once you are on your own.

If you have any question you can contact me.

You can read about me here and my trading mistakes here.

TheOptionCourse.com Copyright @ All Rights Reserved
Dilip Shaw, Founder

Copyright Infringement: Any act of copying, reproducing or distributing any content in the site or newsletters, whether wholly or in part, for any purpose without my permission is strictly prohibited and shall be deemed to be copyright infringement.

INCOME DISCLAIMER: Any references in this site of income made by the traders are given to me by them either through Email or WhatsApp as a Thank You message. However every trade depends on the trader and his level of risk taking capability, knowledge and experience. Moreover stock market investments and trading are subject to market risks. Therefore there is no guarantee that everyone will achieve the same or similar results. My aim is to make you a better & disciplined trader with the stock trading and investing education and strategies you get from this website. Please note that I DO NOT give tips or advisory services by SMS, Email, or WhatsApp or any other form of social media. I strictly adhere to laws of my country. I only offer education on finance, investments on stock markets in the best possible way as much as I can through this website. Still, you must consult an authorized advisor or do thorough research before investing in any stock or derivative before trading any strategy given in this website. I am not responsible for any investment decision you take after reading any article given in this website. Knowledge is the only way to get success in stock markets. I try my best to give stock market investing and trading knowledge through the articles posted in this website. Thanks for visiting my website.

SEBI Allows Equity Derivatives Timing From 9.15 am to 11:55 pm
Some Facts About Share Market And Myths Happening In India

About the author: I started trading stock markets since 2007. However my first 3 years were losses. Then I dedicated almost 1 year on studying, researching, paper trading options and learned a lot in that time. Since 2011 I am trading Nifty options profitably. Call me if you need any help trading options on 9051143004.

{ 0 comments… add one }

Leave a Comment