How is Nifty 50 calculated?

The Nifty 50 is a stock market index in India that shows the performance of the 50 largest companies listed on the National Stock Exchange (NSE). There are several steps involved in calculating the Nifty 50 Index:

Stock Selection: NSE, owner and operator of the Nifty 50 Index, selects the top 50 companies based on various criteria such as market capitalization, liquidity and business activity. These companies must be representative of different sectors of the economy.

Free Float Market Cap: The Nifty 50 Index is a market cap-weighted index, meaning that each stock is weighted by its free-float market capitalization. Free float market capitalization refers to the market value of a company's shares available for trading on the open market.

Base Year and Base Value: The Nifty 50 Index has a Base Year and a Base Value. The base year is the year in which the index is created and assigned a specific value. The base value is the value assigned to the index in the base year. 

The NSE has set the base year of the Nifty 50 Index at 1995 and base value at 1000.039;s) / base market capitalization) * base value.

In this formula, the free float market capitalization is the market capitalization market price of each index stock in the index and the stock price is the current market price of the commodity. The base market capitalization is the sum of the free float market capitalization of all stocks in the index during the base year.

Index Maintenance: NSE regularly reviews the composition of the Nifty 50 Index and makes necessary adjustments to ensure it reflects current market conditions. Depending on their performance and compliance with the selection criteria, stocks can be included in or removed from the index.

Please note that the specific details and method of calculation of the Index may change over time as required by the NSE.