Is NIFTY 50 part of NIFTY 100?

Yes, NIFTY 50 is among the stocks in NIFTY 100. NIFTY 50 vs NIFTY Next 50 vs NIFTY 100 is a comparison in which NIFTY 100 is the broadest index, comprising all NIFTY 50 stocks plus NIFTY Next 50. In combination, the two indices comprise India's top 100 companies based on market capitalisation.

Is the NIFTY Next 50 risky?

NIFTY 50 vs NIFTY Next 50 vs NIFTY 100, the NIFTY Next 50 is the index that is considered to be the riskiest one in the group, owing to greater volatility. By including the large-cap newcomers with solid growth potential, it has the downside of experiencing higher declines in the market as long as corrections last.

Is NIFTY 50 good for the long term?

Definitely, it is NIFTY 50 that has the longest investment horizon. In the NIFTY 50 vs NIFTY Next 50 vs NIFTY 100 comparisons, NIFTY 50 is a well-chosen option for long-term investing. It is composed of India’s most significant large-cap corporations, thus providing stable growth, lower market risks, and a reliable performance throughout the different market phases.

What is the full form of NIFTY?

When considering NIFTY 50 vs NIFTY Next 50 vs NIFTY 100, NIFTY means National Index Fifty. It implies the 50 largest and most liquid companies that are traded on the National Stock Exchange of India and serves as a primary benchmark index.

Pick your Large Cap Index: NIFTY 50 vs NIFTY Next 50 vs NIFTY 100?

The NSE's large-cap indices, such as the NIFTY 50, NIFTY Next 50, and NIFTY 100, differ in composition, stability, and growth potential. NIFTY 50 covers the top 50 blue-chip corporations, NIFTY Next 50 tracks companies ranked 51-100, and NIFTY 100 encompasses the whole large-cap market.

These indexes provide diversified, rule-based equity exposure without the need to choose specific equities. Understanding how they differ allows investors to analyse their sector coverage, volatility characteristics, and performance in the Indian large-cap market.

Key Takeaways

NIFTY 50 provides blue-chip consistency, while NIFTY Next 50 targets future market leaders.

NIFTY 100 offers a balanced "all-in-one" solution for the entire large-cap universe.

Index funds feature relatively low expenses, boosting your final compounding results.

Combining these indices helps balance portfolio risk while maximising total return potential.

What are NIFTY 100, NIFTY 50, and NIFTY Next 50?

NIFTY refers to a family of equity indices created by the National Stock Exchange (NSE) to represent different segments of the Indian stock market. Among them are the most widely referenced large-cap benchmarks, NIFTY 50, NIFTY Next 50, and NIFTY 100. Here’s a deeper look into each one of them:

NIFTY 50

NIFTY 50 is the National Stock Exchange's flagship large-cap index, representing 50 of the largest and most liquid businesses listed on the exchange. It is built using the free-float market capitalisation method, which takes into account only publicly traded shares (excluding promoters and other strategic interests) for calculating index weights. Liquidity filters, impact cost criteria, and derivative availability are used to guarantee that only tradable, high-quality big caps are included.

NIFTY 100

The NIFTY 100 is a broader large-cap benchmark that includes the top 100 companies by overall market capitalisation from the NIFTY 500 universe. It essentially covers the whole Indian big-cap category by merging the NIFTY 50 with the next 50 large and liquid names, resulting in more sector and stock-level diversity. Like the other major NSE stock indexes, it is built using free-float market capitalisation and reviewed semi-annually.

NIFTY Next 50

NIFTY Next 50 is made up of the 50 companies in the NIFTY 100 index after omitting all NIFTY fifty companies, making it the "next rung" of large capitalisation after the main blue-chip basket. It is free-float market cap weighted, but with an extra constraint: the total weight of stocks not accessible in the F&O sector (non-F&O) is set at 10%, and each non-F&O constituent is individually capped at 4.5% at quarterly rebalancing dates. This index frequently contains emerging large-cap leaders and can be more volatile than the NIFTY 50 while providing more long-term growth potential.

Note:

Free-float Market Capitalisation: This is the market value of shares available for public trading, excluding promoter, government, and other locked-in holdings.

Formula: Free-float Market Cap = Share Price × Free-float Shares

Impact Cost: Represents the cost of executing a predefined order size at a given time, indicating liquidity and market depth.

NIFTY Next 50 constituent weights are capped individually at 4.5%, and the cumulative non‑F&O weight is capped at 10% as of the latest methodology.

NIFTY 50 vs NIFTY Next 50 vs NIFTY 100

When NIFTY 50, NIFTY Next 50, and NIFTY 100 are put side by side, the perfect selection has to do with your willingness to take risks and the duration of your investment. Nevertheless, every index provides a unique balance of stability, diversification, and growth potential that is different from the others.

Performance & Risk Comparison (2026)

Index	Volatility	Growth Potential	Typical dividend yield range*
NIFTY 50	Low	Moderate / Stable	Around 1–1.5%
NIFTY Next 50	High	High (future leaders)	Around 1–1.5%
NIFTY 100	Moderate	Balanced	Around 1–1.5%

Note: *Dividend yields fluctuate with prices and corporate actions. The ranges above are indicative based on recent history.

Key Differences

Composition

NIFTY 50: top 50 companies by market capitalisation, providing relative stability during market corrections.

NIFTY Next 50: The next 50 companies by market cap, typically emerging large-cap firms with higher growth potential.

NIFTY 100: The top 100 companies, effectively combining NIFTY 50 + NIFTY Next 50, giving a balanced exposure across large-cap leaders and potential future leaders.

Risk & Returns

Historically (over 5–10 years), NIFTY Next 50 has delivered higher annualised returns (mid-teens) than NIFTY 50, but with greater volatility due to its exposure to emerging companies.

NIFTY 50 has generated low- to mid-teens annualised returns with lower volatility, supported by established sector leaders.

Dividend Yield: NIFTY 50 has typically offered dividend yields in the low single digits (around 1–1.5% in recent years), though yields fluctuate with market conditions.

NIFTY 100 Advantage

NIFTY 100 derives most of its performance from NIFTY 50, while also including NIFTY Next 50, providing diversification across both stable large-cap and high-potential emerging companies.

Sectoral Representation and Weightage

As of late 2025, sector weights from NSE indicate the following broad patterns:

Sector	NIFTY 50	NIFTY Next 50	NIFTY 100
Financial Services	36.56%	20.07%	33.88%
Information Technology	10.41%	2.43%	9.11%
FMCG	6.44%	9.93%	7.01%
Oil, Gas & Consumable Fuels	10.44%	7.91%	10.03%
Automobile & Auto Components	6.98%	8.84%	7.28%
Consumer Services	2.47%	7.45%	3.28%
Power	2.32%	9.19%	3.43%
Healthcare	4.15%	6.24%	4.49%
Metals & Mining	3.73%	7.28%	4.31%
Capital Goods	1.2%	9.65%	2.58%
Realty	-	3.19%	0.52%
Construction Materials	2.08%	3.00%	2.23%
Chemicals	-	3.28%	0.53%
Consumer Durables	-	1.55%	2.31%
Telecommunication	-	-	4.12%
Construction	-	-	3.37%
Services	-	-	1.52%

Based on the above sectoral weightage, NIFTY 100 and NIFTY 50 tilt heavily towards Financial Services, IT, Consumer Goods, and Oil & Gas. However, NIFTY Next covers diverse sectors like Consumer Services, Pharmaceuticals, Metals, Financial Services, and Consumer Goods.

Risk and Returns

The table below shows 1, 3, and 5-year total return performance for NIFTY 50, NIFTY Next 50, and NIFTY 100 from the NIFTY Indices dashboard as of November 30, 2025.

Index	1-Yr Return (%)	3-Yr Return (% p.a.)	5-Yr Return (% p.a.)
NIFTY 50	9.94	13.08	16.48
NIFTY Next 50	-1.33	17.39	18.86
NIFTY 100	7.99	13.43	16.67

As one can see, NIFTY Next has outperformed NIFTY 100 and NIFTY 50, which are close in terms of returns. The condition is due to the following factors.

Key takeaways from this data:

NIFTY Next 50 had the best long-term return over 5 years, indicating considerable growth among firms placed 51-100.

NIFTY 50 and NIFTY 100 had equal performance over 1 and 5 years, with NIFTY 50 significantly ahead over 3 years.

Short-term performance (1 year) has been moderate for all indexes, with NIFTY 50 and NIFTY 100 fairly identical and NIFTY Next 50 somewhat lower over this time.

However, the risks associated with each of the indices differ.

Let's look at the volatility of the indices over the last 1 year (realised volatility):

Index	Volatility (%) (1 Yr)
NIFTY 50	12.02
NIFTY Next 50	17.52
NIFTY 100	12.49

NIFTY Next 50 has higher volatility than both NIFTY 50 and NIFTY 100, indicating larger swings in returns.

NIFTY 50 and NIFTY 100 show comparatively lower volatility, reflecting more stable performance over the last year.

What This Means for Investors

Higher long-term gains for NIFTY Next 50 are associated with higher volatility, implying greater risk and reward potential.

The NIFTY 50 and NIFTY 100 generally deliver consistent performance, making them ideal for investors seeking stability across market cycles.

NIFTY 100 includes both indexes, offering broader large-cap exposure with risk and return characteristics that fall somewhere between NIFTY 50 and NIFTY Next 50.

Diversification Strategy Using NIFTY Indices

The market ups and downs do not affect the investors who use the NIFTY indices as a diversification strategy. The core-satellite approach is the best one: NIFTY 50 for low volatility and steady dividends (with a yield of approximately 1.30%) gets 60–70% allocation, while 20–30% goes to NIFTY Next 50 for long-term growth despite the short-term swings.

For those investors who want straightforwardness, NIFTY 100 for wide exposure to the top 100 companies may be the one to go with. The returns on this strategy result from lower index correlations, an optimal sector distribution, and automatic rebalancing via index fund reviews.

Why Invest in Indices?

Investing in indices is a well-known strategy for accumulating wealth over a long period of time, and, in addition, it provides a diversified portfolio and low unsystematic risk. Investors do not depend solely on one stock but rather gain exposure to a group of top companies, which helps mitigate volatility. To illustrate, NIFTY 50 has provided an average annual return of around 13–18% over the long run, with much lower risk than individual high-growth stocks.

Data-Driven Advantages (2026 Stats)

Automatic quality filter: Indices undergo a semi-annual rebalance, which means that they discard the weakest players and only include the top companies based on free-float market capitalisation.

Cost efficiency: Index funds usually have very low expense ratios, while active funds charge about 1.5%–2% leading to better savings in the long run.

Performance benchmarking: More than 90% of active large-cap funds cannot outperform indices like NIFTY 50 over a period of five years.

Low Tracking Error: Top index funds closely track market returns (with SEBI-capped tracking error at 2%), enabling reliable, transparent growth.

Conclusion

Investing in the NIFTY indices is a strong and secure way to make money over the long term, as it combines three key factors: diversification, cost-efficiency, and rule-based discipline.

Furthermore, these indices are risk-free in terms of emotional bias and bad stock selection, no matter if you prefer the NIFTY 50’s stability, the NIFTY Next 50’s aggressive growth, or the NIFTY 100’s extensive coverage. The Indian economy can thus be effectively captured by investors through an adoption of a core-satellite approach and patience, while keeping management costs at a minimum.