What is Bank Nifty?

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Friends, the biggest index after nifty 50 is called the bank nifty index. In futures and options, the bank nifty index trades at par with nifty or sometimes even more than nifty 50.

Bank nifty includes the top banks of India, you can guess what is going on in the banking sector of the country from the movement of this index. Today, in this post, we will talk about bank nifty in detail. So let’s start this post.

What is Sensex
What is Nifty 50

What is Bank Nifty?

Bank nifty is an Indian banking-related index that shows the workings of Indian banking and moves up or down accordingly. This index shows the liquidity and capital of the 12 biggest banks in India.

Bank nifty was launched in 2003 and it is monitored by India Index Services and Products (IISL).

This index is the best way to understand and check all kinds of information related to the banking sector.

How is bank nifty structured?

The structure of Bank-Nifty keeps changing from time to time as per the need, it reflects the sector representation and free-float market capitalization of listed banking shares from time to time.

The list of stocks included in Bank Nifty is as follows:-

HDFC Bank
ICICI Bank
Kotak Mahindra Bank
Axis Bank
State Bank of India
IndusInd Bank
Federal Bank
IDFC First Bank
Bank of Baroda
RBL Bank
Punjab National Bank
Yes Bank

Benefits of trading in the bank nifty index

Risks of the banking sector

Instead of trading in banking shares, it is much better to trade in banking index in comparison to any one stock because many times a bank can go down but not the entire index, in such a case, it is much better to trade in banking index in comparison to any one bank. Anyway, only the top banks of India are included in this index.

trading volume and liquidity

In comparison to any one banking stock, banking nifty has more volume due to which you can see more swing in the index instead of getting tied up in one stock which is better for any trader. In this, you can buy or sell bank nifty by doing future trading and can also do roll-over if needed.

Taking advantage of volatility

Bank nifty is known for its volatility, which is a golden opportunity for the trader to take full advantage of his knowledge.

You can earn more profit by buying and selling the banking index instead of buying and selling any banking share and whenever you get to know about any kind of monetary policy decision, economic indicators, or any special news related to the banking sector, you can act in this index accordingly.