Nifty Fifty

About Nifty Fifty

The Nifty Fifty were a group of large cap growth stocks on the NYSE in the 1960s and early 1970s that were considered one decision stocks to buy and hold forever. Included companies like Coca-Cola, IBM, Xerox, Polaroid, and McDonalds. The Nifty Fifty traded at P/E ratios of 50 to 90. When the 1973 to 1974 bear market hit, these stocks collapsed. Polaroid fell 90 percent. Xerox fell 70 percent. The Nifty Fifty demonstrated that even high quality companies can be terrible investments at excessive valuations. The Nifty Fifty phenomenon is periodically cited during later market bubbles, including the dot com and AI booms, as a warning about paying excessive multiples for growth.