NIFTY 50 VS SELECTED SECTORIAL INDEXES

This is Post 1 out of 7 in an exploration of an investment strategy known as top-down investing.

This comparative chart showcases the performances of six indexes: NIFTY METAL, NIFTY BANK, NIFTY AUTO, NIFTY IT, NIFTY PHARMA, and NIFTY FMGC against the NIFTY-50 in order to determine their relative strength. This is part of an approach known as top-down investing that I am exploring in my internship with MFA. In this approach, an investor identifies sectoral indexes that are outperforming the overall index (in this case Nifty-50) and then identifies the (usually 3-4) stocks/companies in those indexes that are outperforming/‘carrying’ the rest of the index.