Heavy-lifting giants of Nifty 50 and how fund managers are forced to ‘miss the bus’

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Synopsis
Nifty 50’s top 10 stocks are moving faster and creating wealth like never before. They account for 58% of the market cap of the Nifty 50. But this concentration of the index can hamper fund managers from taking big positions as a fund is not allowed to invest more than 10% of its entire asset in one company.

Rakesh Jhunjhunwala and Prashant Jain did not have much in common. But both of them were long-term bullish on the Indian economy and at the same time they liked to take concentrated positions. Jain was of course restricted as he was handling public money as a fund manager which came under Sebi’s regulation. But interestingly, the index itself is concentrated over the last decade or so where few stocks, the heavy-lifting giants, are delivering