The Nifty 500 is a more broader and comprehensive index. It provides a detailed overview of India”s businesses, covering different sectors and industries. Over the past decade till December 2023, the Nifty 500 index has performed an impressive annualised total return of 16%. It has surpassed all top indices globally, except the Nasdaq 100.

In this blog, we”ll try to analyse the index and its performance in detail.

What is the Nifty 500?

The Nifty 500 consists of the top 500 companies in India that are traded on the National Stock Exchange (NSE). It”s a great tool to understand the Indian stock market as it includes both large-cap and small-cap companies.

The Nifty 500 covers lots of different industries, from technology to medicine, banking to real estate and much more, with each having a maximum weightage cap of 10% only. This maintains equal representation and spreads out the risk.

The index first launched back in April 2005, with an initial value of 1000. It is updated every six months to make sure it represents the market accurately. As of April 3, 2024, you can see the Nifty 500 chart shows its value at 20,602 points.

Financial Performance of Nifty 500

The Nifty 500 Index isn”t just affected by what happens in India– global events also play a big role.

When companies are making a profit, and government policies are evolving positively, people get motivated to invest more, making the Nifty 500 rise. On the flip side when policies create hurdles and news of bankruptcy spreads, the index falls.

Overall the Nifty 500 has achieved great milestones by going from a base value of 1000 in 1994 and reaching 5000 in the early 2000s. Even if we compare it to other indexes like the Nifty 50 and Nifty 100, the Nifty 500 is trusted by investors as it helps them to make better decisions.

With a market capitalization of 35,961,756.36,Cr, the Nifty 500 accounts for about 96.5% of all the trading happening on the National Stock Exchange (NSE). You can analyse its share price and performance with Tradingview. All you have to do is open an account and undertake a Tradingview login.

Should you Invest in the Nifty 500- funds?

Here are the top reasons.

1. Diversification- Instead of putting all your money into one company”s stock, investing in Nifty 500 funds helps spread your investments and reduce overall risk.
2. Easy to Keep Track- When you invest in things that mirror the Nifty 500, it helps you to keep an eye on the whole stock market at once.
3. Saves Money- Trying to build a portfolio that looks like the Nifty 500 on your own can be expensive. But these investments can do it in a much cheaper way.
4. Expert Management- Mutual Funds that follow the Nifty 500 have professionals handling your money. They know how to make the most of your investment, aiming for better returns.

Conclusion

To summarise, the Nifty 500 Index includes the top 500 companies listed on the NSE and offers an overall snapshot of the Indian stock market. Investing in Nifty 500 is quite beneficial in the long run, and is well-suited for people looking to earn passively through their investments. To invest in Nifty 500 stocks, open an account with Dhan which also gives you free access to TradingView.