NSE’s Index Maintenance arm, IISL, has changed the Nifty 50 Index – the top 50 stocks by free float market cap which form the benchmark index with the following exclusions. (From April 1, 2016) Removed: Cairn Vedanta Punjab National Bank Added: Auro Pharma Bharti Infratel Eicher Motors Tata Motors DVR What? Removed Three and Added Four? Precisely. This is annoying. There are supposed to be 50 stocks in an index named, for goodness’ sake, Nifty 50. The index name was specifically changed from “CNX Nifty” to “Nifty 50” in November 2015, just three months ago! The significance of the number 50 was: there are 50 stocks in this index. And now you have 51? This is stupidity because now a lot of algorithms have to be changed, which assumed, perhaps naively, that the Nifty 50 would have only 50 stocks. But Why The DVR? And the 51st stock is: The Tata Motors DVR.… (Read On…)
[via Capital Mind]
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