NSE launches Nifty Midcap150 Quality 50 index

Mumbai: NSE Indices has launched a quality-factor based smart-beta mid-cap index called Nifty Midcap150 Quality 50.

The Nifty Midcap150 Quality 50 index includes the top 50 companies from its parent Nifty Midcap 150 index, selected based on their ‘quality’ scores, NSE said in a release.

The quality score for each company is determined based on return on equity, financial leverage (except for financial services companies) and earning per share (EPS) growth variability of each stock analysed during the previous 5 financial years, it said.


The weight of each stock in the index is based on a combination of stock’s quality score and it's free float market capitalisation, it added.

The base date for the index is April 1, 2005 and base value is 1000. The index composition is reconstituted on a semi-annual basis.

The Nifty Midcap150 Quality 50 index will be calculated on an end-of-day basis. The index is expected to act as a benchmark for asset managers looking for a reliable metric that measures risk-return dynamics of quality-factor based mid-cap portfolios, the release said.

The index is also expected to be reference index tracked by passive funds in the form of exchange traded funds (ETFs) or index funds and structured products, it added.