Parents

		How did the S&P CNX Nifty come about?
		Where does IISL come in?
		Who is Standard & Poors, and why does their name appear with the S&P CNX Nifty's?
		What does CNX in "S&P CNX Nifty" stand for?
		We sometimes hear the term `nifty fifty' used in the US to denote a certain set of growth stocks. Is there any connection?

How did the S&P CNX Nifty come about?
Equities trading at NSE began in November 1994. By late 1995, NSE became India's largest equity market and was looking for a market index to utilise this unique information source. NSE also wanted to have a vehicle for the futures and options market. NSE approached the economists Dr. Ajay Shah and Dr. Susan Thomas, ( then at Centre for Monitoring Indian Economy Pvt. Ltd.- CMIE (www.cmie.com) and now at Indira Gandhi Institute of Development Research (IGIDR - www.igidr.ac.in), to conduct research on methods in index construction. This work was funded by the USAID FIRE project (www.usaid.gov) and led to the S&P CNX Nifty. Some of their research is visible over the Internet at www.igidr.ac.in/~ajayshah

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Where does IISL come in?
In 1998, NSE and CRISIL launched a joint venture named IISL to focus on index management. This pools the index development efforts of CRISIL and NSE into a coordinated whole, India's first specialised company focussed upon the index as a core product. Today, the S&P CNX Nifty is owned and operated by IISL. It is a global phenomenon where an independent company calculates and maintains the index.

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Who is Standard & Poor's, and why does their name appear with the S&P CNX Nifty?
S&P owns the most important index in the world, the S&P 500 index, which is the foundation of the largest index funds and most liquid index futures markets in the world.
When S&P came to India to look at market indices, they focussed upon the S&P CNX Nifty as opposed to alternative indices. They now stand behind the S&P CNX Nifty, as is evidenced by the name "S&P CNX Nifty" This is a unique occasion; S&P has never endorsed a market index before.

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What does 'CNX' in S&P CNX Nifty stand for?
CNX stands for CRISIL NSE Indices. CNX ensures common branding of indices, to reflect the identities of both the promoters, i.e. NSE and CRISIL. Thus, 'C' stands for CRISIL, 'N' stands for NSE and X stands for Exchange or Index. The S&P prefix belongs to the US-based Standard & Poor's Financial Information Services.

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We sometimes hear the term `nifty fifty' used in the US to denote a certain set of growth stocks. Is there any connection?
No. It's purely coincidental. It was research that led to the choice of 50 stocks as the optimal size of an index in the Indian equity market. One day, a clever leap was made from NSE-50 to `S&P CNX Nifty'.

Last updated on March 10, 2008.