What is Nifty100 Alpha30?

Alpha is the favourite buzzword of smart investors. NSE launched the smart-beta index Nifty100 Alpha30 in June this year. An alpha index strategy aims to select stocks that have recently outperformed the broad benchmark on a risk adjusted basis. Let's check out which stocks feature in this index.

Nifty100 Alpha30 is a kind of super version of the base index Nifty100. It comprises of 30 stocks from the parent index Nifty100. The stocks of Nifty100 Alpha30 are selected based on their Jensen's alpha score calculated using 1-year trailing prices. The index's base date is April 1, 2005 and base value is 1000. The weightage given to each stock is computed based on a combination of its alpha score and its free float market capitalisation. Sector-wise, each sector's weightage in the index is capped at 25 per cent and the same is rebalanced on a quarterly basis. The index was launched in June 28, 2019.

NIFTY100 Alpha 30 index will be computed on an end-of-day basis. Market participants can deploy this index as benchmark or create index funds, ETFs and other structured products based on it.

Here are the top constituent stocks of Nifty100 Alpha30 according to weightage

Other constituent stocks of the index include Asian Paints, Wipro, Bajaj Finserv, HDFC Bank, Titan, Dabur, UPL, ICICI Bank, Kotak Bank, Dr. Reddy's, Britannia, United Breweries, HCL Tech, Aurobindo Pharma, Colgate Palmolive, Marico, Bajaj Holding, ICICI Lombard, P&G and Avenue Supermart.