A Brief Overview of the Nifty Midcap150

We all want to invest in firms that are expected to develop quickly. Companies that expand swiftly frequently have the potential to double our investments and produce great wealth for us since stock prices reflect the rise in a company’s profits and profitability. Looking in the mid-cap area is a more logical method to identify such high-growth firms. Large-cap companies are often market leaders in their respective industries and have significantly less opportunity to develop than mid-sized companies.

The NIFTY Midcap 150 reflects the following 150 firms (ranked 101–250) based on total market capitalisation from the NIFTY 500. The purpose of this index is to track the performance of firms with a market capitalization of less than $1 billion. But now the question is, what is nifty midcap 150 and read till the end, and all your doubts are going to resolve.

What is NIFTY Midcap 150?

• The NIFTY Midcap 150 comprises 150 companies (ranked 101–250) based on the total market capitalization of the NIFTY 500 Index
• The total market capitalization of a firm is calculated by multiplying its stock price by the number of shares outstanding (active shares readily available in the market and inactive shares such as those held by promoters or the government)
• To make matters even simpler, the NIFTY 100 index comprises the 100 largest firms (in terms of total market capitalization) in the NIFTY 500 index. The NIFTY Midcap 150 index includes firms rated 101 to 250 based on total market capitalization
• The NIFTY Midcap 150 is now created in such a way that the 150 businesses that compose the index are from various sectors and have varied weights. Let’s take a closer look at it

Who launched NIFTY Midcap 150?

Nifty Midcap 150 was launched by the UTI Mutual Fund. This is an answer to Who launched NIFTY Midcap 150.

What is the nifty midcap 150 weightage of various companies and sectors?

• The weightage of a business in the NIFTY Midcap 150 index is determined by its free-float market capitalization. The free-float market cap is computed by multiplying the stock price of a firm by the number of freely accessible shares in the market. For example, if a firm has 1 lakh shares easily available in the market and the price per stock is Rs. 30, the market capitalization of the company is Rs. 30 lakh.
• So, the NIFTY Midcap 150 index contains 150 businesses (ranked 101–250) from the Nifty 500 Index based on complete market capitalization. The weight of a firm in the index, however, is determined by its free-float market capitalization
• As a result, firms with greater free-float market capitalizations have a higher weightage in the index. Adani Total Gas Ltd., for example, has a market capitalization of roughly Rs. 2.5 lakh crore as of March 31, 2022. As a result, it has a bigger weight in the index than Tata Power, which has a market capitalization of roughly Rs. 43,000 crore
• The weights of the index’s 150 businesses alter on a daily basis since a company’s free float market cap is ultimately determined by its stock price. In reality, if the price of a mid-cap company climbs enough, it becomes a large-cap stock. As a result, it is no longer included in the NIFTY Midcap 150 index. Similarly, if a company’s stock price falls significantly, it becomes a small-cap stock. The stock was also removed from the NIFTY Midcap 150 index in this situation
• Because of this market-cap rating, the 150 mid-cap businesses that constitute the NIFTY Midcap 150 index are constantly changing. The index is rebalanced twice a year. The NIFTY Midcap 150 index eliminates stocks that would have decreased or grown in market cap during the rebalancing process. It also removes firms that would have been suspended or delisted

What is Nifty Midcap 150’s Return Generated?

Investing in equities is usually fraught with ups and downs. Investing in the NIFTY Midcap 150 index is no exception. Nonetheless, the index has provided good long-term gains.

Over the previous 15 years, the NIFTY Midcap 150 index has provided an annual average return of 16.5 percent. To put the returns into context, if you had invested Rs. 10,000 each month in the NIFTY Midcap 150 index for the last 15 years, you would have amassed nearly Rs. 78 lakh by March 2022.

These are fairly good returns on their own. To put the returns in context, let’s compare the NIFTY Midcap 150 index returns to the returns of actively managed mid-cap funds. It will help us make a fair assessment and decide if it is worthwhile to invest in the mid-cap area through passive funds.

 What is the Nifty Midcap 150 list of the top ten companies?

These are the list of top  stocks in the nifty midcap 150 list:

1. Adani Total Gas Ltd.
2. Tata Power Co., Ltd.
3. Tata Elxsi Ltd.
4. Voltas Ltd
5. Trent Ltd.
6. MphasiS Ltd.
7. AU Small Finance Bank Ltd. 
8. Page Industries Ltd.

Conclusion

Investing in the NIFTY Midcap 150 Index is as simple as selecting an index fund or ETF that tracks the index. As a result, your assets will decline when the index falls and rise only when the index rises. 

As a result, you’ll never be able to outperform the index. Investing in the NIFTY Midcap 150 index allows you to invest in 150 companies with the potential to develop rapidly. These are the firms that have the potential to become industry leaders. As a result, you greatly increase your chances of accumulating significant money in the long run. Investing in the NIFTY Midcap 150 index through index funds may also be straightforward, simple, and cost-effective.