How the Index Analysis Tool Works
This tool takes the daily closing values of six key Indian market indices, the BSE Sensex, Nifty 50, Nifty 500, Nifty LargeMidcap 250, Nifty Midcap 150 and Nifty Smallcap 250, and shows how the index you pick has performed in three different ways: trailing returns, discrete returns and rolling returns. The return graph can show any of the lines together, a trailing returns table lists all of them side by side for YTD, 1 day, 1, 3 and 6 months and 1, 3, 5, 7 and 10 years, a SIP growth card shows what a monthly SIP of ₹1,000 in the index would have become over a trailing period, a rolling returns table gives the latest, average, median, best and worst 3, 5, 7 or 10 year rolling return of each index, and the other cards (discrete returns, best and worst period, risk metrics and index audit) can be switched between the indices with the buttons at their top.
Want to analyse a mutual fund instead? Use our Mutual Fund Analysis Tool, or see what a monthly SIP in a fund would have given you with the SIP Backtest Tool.
What is used, and what is left out
- Data: the daily closing values of each index, collected and stored by PortfolioCube's server so that the page loads quickly. Price-index values come from Yahoo Finance; total-return (TRI) values come from NSE Indices.
- Price or total return: you choose. A price index leaves out the dividends its shares pay. A total-return index (TRI) counts them as reinvested and shows a slightly higher figure (for large caps, roughly 1% a year). The Sensex is available as a price index only, as its TRI has no data source here yet.
- Not included: an index cannot be bought directly. The return of an index fund or ETF differs from the index by its expenses and tracking difference.
- History: each index is shown from the first date available; periods longer than that history are shown as “--”.
Terms and Definitions
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Trailing return – how much the index level has grown over a fixed period that ends today (the latest level date), such as the last 1 month, 6 months, 1 year or 3 years. It answers “what did the index give me if I had put in a lump sum exactly that long ago?” It is measured on the index's own level, so it is not your SIP return. Up to 1 year the figure is the plain (absolute) gain; beyond 1 year it is shown per year (annualised, also called CAGR) so that a 3-year and a 5-year figure can be compared. YTD means from the last 31 December to today. Example 1: the level was 100 a year ago and is 113.91 today, so the 1-year trailing return is +13.91%. Example 2: the level was 100 three years ago and is 141.1 today; the index gained 41.1% in total, which is about 12.16% a year, so the 3-year trailing return is shown as +12.16%. Limitation: every trailing return ends today, so an index that had a great or terrible last few months looks very different from the same index a quarter earlier.
Discrete return – the index's return in each separate, non-overlapping period of the calendar: each year, quarter, month or week, shown one bar per period. It answers “how did the index do in that particular year (or month) on its own?” and so shows how uneven returns really are, including the bad periods that an average hides. The latest bar is the current period so far (for example the year to date), not a full period. This page shows every year since 2000 (or since the index began, if later), the last 12 quarters, 24 months or 26 weeks. Example: if the level was 100 on 31 December 2023, 120 on 31 December 2024 and 114 on 31 December 2025, the bar for 2024 is +20.0% and the bar for 2025 is −5.0%, even though the index is up 14% over the two years taken together. Tip: hover over (or touch) any bar to see its exact value.
Rolling return – the annualised return over a fixed holding period (3, 5, 7 or 10 years), calculated again for every day the index has history for, each time looking back that many years from that day. The result is a line showing what an investor would have earned whichever day they had started, so it removes the luck of the start date. Beside the line the page shows the average, the median, the best and worst outcome, and the share of days on which the return was positive. Example: for a 3-year rolling return, the point on 15 March 2024 is the yearly return from 15 March 2021 to 15 March 2024; the point on 16 March 2024 uses 16 March 2021 to 16 March 2024, and so on. If the average is +15.97% and the worst is −6.40%, then most 3-year holders earned about 16% a year, but someone who started on the worst day lost about 6.4% a year. A period is shown only if the index is old enough: 10-year rolling returns need more than 10 years of levels.
Best & Worst Period – the highest and the lowest return the index gave over any 1 week, 1 month, 3 months or 1 year, whichever trading day the period started on, together with its begin and end dates. It shows the best the index has done and the worst you could have lived through over each length of time. Example: if the best 1-month return is +18.46% (4 Jun 2024 to 4 Jul 2024) and the worst is −13.49% (11 Apr 2022 to 11 May 2022), then within any single month the index has gained as much as 18.46% and fallen as much as 13.49%. The returns are not annualised.
Risk metrics – six numbers that describe how bumpy the ride was, all worked out from the index's calendar-month returns over the lookback window you pick: 3, 5, 7 or 10 years (3 by default) (the return from one month-end level to the next; the running month is left out).
Mean return – the average monthly return multiplied by 12, to give a yearly figure. Example: an average of 1.95% a month is a mean return of 23.4%.
Standard deviation – how widely the monthly returns swing around their average, shown per year (monthly figure × √12). The higher it is, the bumpier the ride. Example: 20.5% means the index's yearly return has typically moved about 20 percentage points either side of its average.
Sharpe ratio – return earned above the risk-free rate for every unit of standard deviation: (mean return − risk-free rate) ÷ standard deviation. Higher is better. Example: (23.4 − 5.5) ÷ 20.5 = 0.87.
Sortino ratio – like Sharpe, but it divides by the downside deviation, which counts only the months that fell short of the risk-free return, so upward swings are not penalised. Higher is better.
Risk graph – a dot plot that puts return against risk. Each dot (one per index) sits at its trailing return (up) and its standard deviation (across) for the period you pick: 1, 3, 5, 7 or 10 years, or since launch. The higher and further to the left a dot is, the better the return for the swing taken. Example: an index at 22% standard deviation and 18% return, next to the Nifty 50 at 14% and 12%, has earned more but also been bumpier.
Annualised return (CAGR) – the return expressed per year, so that periods of different length can be compared. Example: a gain of 41.1% over 3 years is about 12.16% a year.
Since inception – the yearly return (CAGR) from the first closing value available for an index to the latest one, so indices with a longer history can be compared with younger ones on a per-year basis. Example: a level of 1,000 in 2005 and 24,000 today over about 21.5 years is about 15.7% a year. The start date is shown under each figure.
Price index (PRI) – an index that tracks only the prices of its shares and leaves out the dividends they pay.
Total return index (TRI) – an index that also counts the dividends its shares pay, as if reinvested, so it grows slightly faster than the price index. It is the fair comparison for a growth-option fund, whose NAV includes reinvested dividends. Choose it in the Return basis option of the input card.
Nawneet Kumar Panjiyar is an AMFI Registered Mutual Fund Distributor (ARN 303470) and does not provide investment advisory services in the capacity of a Registered Investment Adviser. This tool is for education and illustration only.
