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As Nifty Next 50 suffers a fall, its exposure to Adani stocks sparks a debate on concentration risk

As Nifty Next 50 suffers a fall, its exposure to Adani stocks sparks a debate on concentration risk
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An electronic signage displays news on the Adani Group at the Bombay Stock Exchange building in Mumbai.

Synopsis

Stocks of Adani Total Gas, Adani Transmission, and Adani Greens have fallen by around 50% in the last 10 days. The Nifty Next 50 index, which has a 9% concentration of these stocks, has fallen 8%. But then on good days, these stocks helped the Nifty Next 50 return 80%.

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6 mins read, Last Updated:
Over the last one month, exchange-traded funds (ETFs) and indexes based on the Nifty Next 50 have fallen 9%. This is, to a large extent, believed to be due to the exposure of the index to three Adani stocks that account for 9% of its portfolio, according to the December factsheet. In January, the same number has come down to 6%. The recent crash in the stock prices of Adani Group companies has left many market advisors as well as investors on a

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