Nifty composition, Nifty50 scrips' influence on Nifty points, Nifty50 weightage

A weekend look at the NIFTY index.

Yesterday Infosys & other IT scrips dragged the index down, while Reliance was almost inert. And, the whole day the financials also had a lead in Nifty movements, virtually going in tandem.

So, why does Infosys affect Nifty move so much ?

Infosys caused 34 Nifty points loss, Wipro a 10 points and TCS another 7 points. This is 51 points of the 87 points loss in Nifty.

The reason is Infosys is a major constituent of NIFTY index.

Infosys occupies  8.9  %

Wipro             1.38 %

TCS               3.42 % 

effectively making 14.8 %, or about 1 in 6 portion of Nifty.

Industry-wise,

Financials occupy major share in Nifty : about 26.5 %

with 6 banks, 1 AMC, 1 HousingFinance, 1 Industrial finance companies.

Software & Telecom takes another pie of 17.25 %

with 4 Software majors, and 2 Telecomm / ISPs.

The third major segment is Minerals with 15.5 %,

out of which Reliance alone makes up 10.6 % !

Now, some top scrips with higher share in Nifty are:

10.12 % Reliance

 8.90 % Infosys

 7.32 % ICICIbank. 

between them these 3 companies take 26.3 %, or quarter of Nifty index.

The balance 47 companies share the other 73.7% ...

If these 3 big blues move in tandem in one direction, Nifty will feel the weight and leverage of them and respond.

If we add to the above 3 companies another top 5 scrips:

4.76 % HDFC bank

4.06 % SBI

5.19 % HDFC

5.50 % ITC

5.03 % L&T

These 8 companies will make up about 50% of NIFTY index,

while the rest of the 42 scrips are in the other 50% pie.

Lets assume these 8 scrips making a rally of 2 %, and the rest of the 42 Nifty scrips sink by 2 %, the Nifty would remain unchanged.

So, these are the heavy-weights, heavy guys who can tip and tilt Nifty in a jiffy, and cause a roller-coaster effect on other scrips by affecting the sentiment and instinct.

Now on have an eye on the heavy ones if they 

go for a duck or go for sixers.

The following table gives a broad picture on the Nifty 50 scrips, which industry they are classified to, and which industrial segment is the holder of the remote control.

[note: FreeFloat marketcap concept is used for Nifty calculation, so, the weightage will keep changing from time to time, based on this concept]

Next time we shall have a look into how Nifty correlates with other NSE indices.

The following table shows the 50 Nifty scrips performance on Friday, and how much they influenced Nifty index points.

NIFTY COMPOSITION as on day

Have a great weekend !!!
Be also prepared, Infosys may have a knee-jerk balancing act.

Nifty and Sensex Indices Constituents and Influence of their weight on weightage

Reliance, Infosys and ICICIbank covers more than 30% of Sensex, so when they move in a direction Sensex will be heavily influenced.
Adding LT, ITC, HDFC and HDFCbank, more than 50% Sensex is covered.
And, to this 7 another 7 more, making the Top 14 companies will make up 77% of the Sensex.
The details are in the Table and Chart below.

Nifty Index gets its weightage more than 50% from the Top 8 companies,
and more than 75% from the Top 20 companies.
The List of Constituents, their weightage, beta, R2 and market cap is given in the table and the weightage is given in the chart below:
So, if these 8 scrips make a concerted big move either side, Nifty would be swayed in that direction.