The fifty large-capitalization stocks with outstanding growth record and prospects such as IBM, Kodak, McDonald’s, Disney, Xerox, DuPont, General Electric, and Procter and Gamble, among others. A good-sized position could be taken in such stocks without the market being disturbed or materially affected. These stocks were almost surefire growers, whereas the price paid for them would be justified sooner or later. Also, once bought, an investor would never need to sell them. Investors in general and institutional investors in particular tend to have them in their holdings due to their excellent historical performance (in terms of earnings and dividends). There is no official list of the Nifty Fifty, but what is on the list is well known for everyone in the investment community. Broadly speaking, to be on the “Nifty Fifty” list, a stock must be enlisted in the S&P 500, and is always one of the 100 largest capitalization stocks in that index, and also so often one of the fifty largest capitalization stocks in the S&P 500. Investors take the Nifty Fifty stocks for granted and tend to buy and hold them for the long run because are believed gain value for certain.

The Nifty Fifty stocks are sometimes called “one decision stocks”, because once an investor makes a decision to buy them, his portfolio-management problems are virtually expected to be over, i.e., no further decisions would need to be made (buy and hold strategy).

These stocks are also called favorite fifty or institutional favorites.