Index funds are a great investment option for people who do not want to spend time choosing specific stocks but rather track an index. An index, like the Nifty 50, is made up of a wide range of stocks, including shares from multiple sectors. The Nifty 50 also has a counterpart, the Nifty Total Market Index.

The Nifty 50 index is one of the, if not the, most popular indexes in the country. It is considered an indicator of overall market activity and investor sentiment. As its name suggests, Nifty 50 contains the 50 largest companies according to their market capitalisation. In the same vein, the Nifty Total Market Index is even broader, as it contains approximately 750 businesses.

In this article, we will compare the Nifty 50 vs. Nifty Total Market Index to learn about their differences and which investment would suit you better.

• Nifty 50 is ideal for investors seeking low-risk, large-cap exposure, as it consists of the top 50 companies listed on the NSE, offering high liquidity and stability.
• The Nifty Total Market Index provides a more comprehensive view of the Indian stock market, with over 800 companies across large, mid, and small-cap segments. It is suitable for those seeking broader market exposure.
• Nifty 50 focuses on sector leaders, especially in financial services and IT, while Nifty Total Market Index offers broader sector diversification.
• Risk varies between the two indices, with Nifty 50 offering lower risk due to its large-cap focus.

The Nifty 50 is one of the most popular and diversified equity market indexes. It comprises companies that are leaders in their sectors and are listed on the NSE (National Stock Exchange). The index is managed by Nifty Indices Limited, which is an NSE subsidiary. It is reviewed semi-annually and is consistently rebalanced to accurately reflect the Indian stock market.

This index is also called the Nifty Total Stock Index. It is broader than the Nifty 50 and consists of all the companies listed on the NSE. This index weighs all stocks according to their free-float market cap, ensuring that the total market cap of the Indian stock market is accurately represented.

With a brief overview, let us now compare the Nifty 50 vs. Nifty Total Market Index:

Let us also take a look at the top sectors of companies on Nifty 50 vs. Nifty Total Market Index:

Nifty 50

Nifty Total Market Index:

The Nifty 50 and Nifty Total Market Index serve as key benchmarks for tracking the Indian stock market, but they differ in scope and risk profiles. The Nifty 50 focuses on the top 50 large-cap companies, providing stability and lower risk for investors who prefer blue-chip stocks. In contrast, the Nifty Total Market Index includes a broader spectrum of over 800 companies from different sectors and market capitalisations, offering higher growth potential but also higher risk. Investors should choose between Nifty 50 vs. Nifty Total Market Index based on their risk tolerance, investment goals, and preference for market exposure.