Bank Nifty

Andrian Chase
Created by Andrian Chase Sep 15, 2020

What is the Bank Nifty?

Bank Nifty represents the 12 most liquid and large capitalized stocks from the banking sector which trade on the National Stock Exchange (NSE). It provides investors and market intermediaries a benchmark that captures the capital market performance of the Indian banking sector.
An index comprising 12 state-owned and private sector banks. Like the Nifty, those bullish on banks can buy Bank Nifty futures comprising 30 shares, or buy a call option on BankNifty. Bears can similarly short or sell Bank Nifty Future options or buy a put option on the index.
Banknifty is an index which is the most popular in India. In which there is a lot of volume and volatility, which the traders take advantage of volatility. BankNifty Index is the only index in the Indian stock market.
In which the Weekly option is started, monthly options contracts expire on the last Thursday of the expiry month and weekly options contracts expire on every Thursday of the week. If the last Thursday is a trading holiday, the contracts expire on the previous trading day.
How does Bank Nifty work?
Bank nifty consists of stocks of private and public banks linked to the banking sector. Based on whose value, Bank nifty makes a movement. If there is any positive news on the banking sector, then it also has a good impact on the Banknifty. Bank nifty futures operate based on the spot price.
Weightage of Banks in Bank Nifty:
Banks                                       Weight(%)
HDFC Bank Ltd 35.77%
ICICI Bank Ltd 16.58%
Kotak Mahindra Bank 12.96%
State Bank of India 8.6%
IndusInd Bank Ltd 8.49%
Axis Bank Ltd 7.53%
Yes Bank Ltd 5.2%
Federal Bank Ltd 1.63%
Bank of Baroda 1.25%
Punjab National Bank 0.92%

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