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Have you ever thought of analysing the Nifty 50 shares to pick the best ones out of them?
Well, we will share with you some simple Tips to find out how?
First and foremost, please see the following data analysis:
See in BrowserIn the above data analysis you have at the top the analysis of the Nifty 50 Index. And below that you have analysis of the 50 constituents of the Nifty 50 Index.
At the top you find the performance of the Index. And below that you find the performance of the 50 constituents of the index. You have the following performance parameters:
Terms used in the above Analysis:
(1) OPEN is the figure of the last closing. (2) HIGH is the highest point the stock or index reached on that day. (3) CMP is the Current Market Price of the Stock or Index. (4) CHG is the Change in the points of the Stock or Index from the previous close. (5) CHG% is the Percentage Change in the points of the Stock or Index from the previous close. (6) 52WH is 52 Week High price of the Stock or Index. (7) 52WL is 52 Week Low price of the Stock or Index. (8) GY22% is the Percentage Growth in the Stock or Index in the Financial Year 2022. (9) GY21% is the Percentage Growth in the Stock or Index in the Financial Year 2021. (10) GY20% is the Percentage Growth in the Stock or Index in the Financial Year 2020. (11) 5YCAGR is the Five Year Compounded Average Growth Rate of the Stock or Index. (12) NAME is the Name of the Stock or Index. (13) SYMBOL is the Symbol of the Stock or Index. (14) VOLUME is the Volume of the Stock. (15) MC is the Market Capital of the Stock in Rs. Cr. (16) EPS is the Earnings Per Share of the Stock. (17) PE is the Price to EPS ratio of the Stock. (12) ALPHA is the Excess Returns given by the Stock over the Benchmark Index Return.
So we can use any of the above parameters for our performance analysis. Now, since the data is live, realtime, and dynamic, we are using the following still image to illustrate the analysis:
Let us see the above data in the still image.
You will see that the Index is grown by 1.60% in the FY 23, by 18.85% in the FY 22, and by 80.13% in the FY 21. And the Index is grown by 14.69% compounded average rate of growth (CAGR) in the last 5 years. This we can use as a standard for comparing the performance of the 50 index components or constituents.
Now let us look into the performance of the constituents. But how? You see, you can sort on any column just by clicking on any of the columns. So here I am sorting on the growth in the FY23. In the still image you will find 15 scrips from 62.08% at the heighest to 13.67% at the bottom. If you wish to choose the crietarian of growth in the current year (CY) then you can use this method. This is one way. But this is looking into performance of the scrips only during the current year.
The second crietarian is to look into the performance for a longer period. Let us look into the performance for at least 5 years. So we have chosen 5 year CAGR and sorted on the Alpha.
Now what is Alpha? Alpha gives you the measure of success of your investment, and in this case it is the equity stocks. It calculates how much a stock has outperformed the general market rate of return.
In our case the general market return is the return of the index. That is the 5 year CAGR of the index. Which is 14.69%. So, any stock that beats this rate of return has beaten the market. In our case around 20 stocks have beaten the above general rate of return. The 10 stocks listed above are one of the bests. They have given much more higher positive Alpha. So the best stock is with higher positive (+) Alpha. The more the Alpha the better is the stock. So the second crietarian is to follow this method.So, this is how we can analyse the Nifty 50 stocks to pick the best ones for your investment.
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Disclaimer:
All the data and information is provided “as is” for personal informational purposes only and is not intended for trading purposes or investment, tax, legal, accounting, or other advice. Please consult your broker or financial representative or investment advisor to verify pricing before executing any trade. None of the data and information constitutes a recommendation by us to buy, sell, or hold any security or financial product, and we make no representation regarding the advisability or suitability of any investment. The data is real-time and dynamic and sourced from Google Finance with the help of Google Charts.
The stock market is filled with individuals who know the price of everything, but the value of nothing.
