Nifty next 50 index funds
As the market is heading lower because of COVID-19; Investors are eagerly looking to find the best opportunity for them to invest in the stock market. Most investors want to keep safety margin and trying to get the benefit of low stock prices by investing in mutual funds.
But ever since Warren Buffet said- People who do not understand stocks are better off investing just in ETFs- Since then there is huge interest that has built up investing to Index ETFs and Index funds.
In Indian stock market there are various kinds of Index fund available, to name a few famous ones:-
- Nifty 50 Index funds
- Nifty Next 50 Index funds
- Nifty Junior Index funds
- Sensex Index funds
- Nifty 100 Index fund
Here we will focus on Nifty next 50 Index funds as people can invest in any index fund/ Nifty next 50 Index funds as a mutual fund with out needing to have a demat account.
What is Nifty next 50 Index?
According to NSE India - The NIFTY Next 50 Index represents 50 companies from NIFTY 100 after excluding the NIFTY 50 companies.
Which stocks are part of Nifty next 50 Index?
| Company Name | Industry |
| ACC Ltd. | CEMENT & CEMENT PRODUCTS |
| Adani Transmission Ltd. | POWER |
| Ambuja Cements Ltd. | CEMENT & CEMENT PRODUCTS |
| Ashok Leyland Ltd. | AUTOMOBILE |
| Aurobindo Pharma Ltd. | PHARMA |
| Avenue Supermarts Ltd. | CONSUMER GOODS |
| Bajaj Holdings & Investment Ltd. | FINANCIAL SERVICES |
| Bandhan Bank Ltd. | FINANCIAL SERVICES |
| Bank of Baroda | FINANCIAL SERVICES |
| Berger Paints India Ltd. | CONSUMER GOODS |
| Biocon Ltd. | PHARMA |
| Bosch Ltd. | AUTOMOBILE |
| Cadila Healthcare Ltd. | PHARMA |
| Colgate Palmolive (India) Ltd. | CONSUMER GOODS |
| Container Corporation of India Ltd. | SERVICES |
| DLF Ltd. | CONSTRUCTION |
| Dabur India Ltd. | CONSUMER GOODS |
| Divi's Laboratories Ltd. | PHARMA |
| General Insurance Corporation of India | FINANCIAL SERVICES |
| Godrej Consumer Products Ltd. | CONSUMER GOODS |
| HDFC Asset Management Company Ltd. | FINANCIAL SERVICES |
| HDFC Life Insurance Company Ltd. | FINANCIAL SERVICES |
| Havells India Ltd. | CONSUMER GOODS |
| Hindustan Petroleum Corporation Ltd. | OIL & GAS |
| Hindustan Zinc Ltd. | METALS |
| ICICI Lombard General Insurance Company Ltd. | FINANCIAL SERVICES |
| ICICI Prudential Life Insurance Company Ltd. | FINANCIAL SERVICES |
| Indiabulls Housing Finance Ltd. | FINANCIAL SERVICES |
| InterGlobe Aviation Ltd. | SERVICES |
| L&T Finance Holdings Ltd. | FINANCIAL SERVICES |
| Lupin Ltd. | PHARMA |
| Marico Ltd. | CONSUMER GOODS |
| Motherson Sumi Systems Ltd. | AUTOMOBILE |
| NHPC Ltd. | POWER |
| NMDC Ltd. | METALS |
| Oracle Financial Services Software Ltd. | IT |
| Page Industries Ltd. | TEXTILES |
| Petronet LNG Ltd. | OIL & GAS |
| Pidilite Industries Ltd. | CHEMICALS |
| Piramal Enterprises Ltd. | FINANCIAL SERVICES |
| Power Finance Corporation Ltd. | FINANCIAL SERVICES |
| Procter & Gamble Hygiene & Health Care Ltd. | CONSUMER GOODS |
| Punjab National Bank | FINANCIAL SERVICES |
| SBI Life Insurance Company Ltd. | FINANCIAL SERVICES |
| Shriram Transport Finance Co. Ltd. | FINANCIAL SERVICES |
| Siemens Ltd. | INDUSTRIAL MANUFACTURING |
| The New India Assurance Company Ltd. | FINANCIAL SERVICES |
| United Breweries Ltd. | CONSUMER GOODS |
| United Spirits Ltd. | CONSUMER GOODS |
| Vodafone Idea Ltd. | TELECOM |
| Company’s Name Weight(%) | |
| Top constituents by weightage | |
| Avenue Supermarts Ltd. | 5.47 |
| Divi's Laboratories Ltd. | 4.58 |
| HDFC Life Insurance Company Ltd. | 4.52 |
| Dabur India Ltd. | 4.26 |
| SBI Life Insurance Company Ltd. | 4.14 |
| ICICI Lombard General Insurance Company Ltd. | 3.98 |
| Pidilite Industries Ltd. | 3.58 |
| Godrej Consumer Products Ltd. | 3.17 |
| Lupin Ltd. | 3.09 |
| Colgate Palmolive (India) Ltd. | 3 |
The stock in the Nifty next 50 Index gets reviewed every 6 months. As per the performance of the stocks, few stocks can move out of the index and few new stocks may be added.
How is the performance of Nifty next 50 Index?
After a recent sharp correction the Nifty next 50 Index has given a good bounce back. But as the market is continuously volatile the Nifty next 50 Index may go down again with broader market performance.
Reasons to invest in Nifty next 50 Index?
Historically, stocks in Nifty next 50 become the next leaders of market if you see the current index composition the Index currently have very good stocks like DMART, HDFC Life, ICIC Pru. The Index may be currently under pressure but when we recover from the market down turn, it may offer excellent returns!
How to invest in Nifty next 50 Index funds?
There are various AMCs offering Nifty next 50 index funds. To name a few :-
- ICICI Pru Nifty next 50 Index fund
- UTI Nifty next 50 Index fund
- DSP Nifty next 50 Index fund
- Motilal Oswal Nifty next 50 Index fund
Which Nifty next 50 Index fund to select?
Recommendation will be to select a fund which has good AUM , less tracking error and less expense ratio. As most of the Nifty next 50 Index funds will give more or less the same returns but if the fund has a higher expense ratio then the returns may be less.
Who should invest in Nifty next 50 Index funds
Nifty next 50 Index funds are bit riskier than Nifty 50 Index funds as they fall in Large to mid cap category. If your risk appetite is towards mid-cap stocks then you can look to invest in Nifty next 50 Index funds.
New to mutual funds? Consider reading - What is a mutual fund? and How to select mutual funds India?
New to mutual funds? Consider reading - What is a mutual fund? and How to select mutual funds India?
Disclaimer- Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
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