A deep dive into the Nifty 200 Index—its structure, significance, and how investors can benefit from tracking or investing in it.
The Nifty 200 is a benchmark equity index designed to represent the performance of large- and mid-cap stocks listed on the National Stock Exchange (NSE) of India.It comprises the Nifty 100 (India’s top 100 companies by market cap) and the next 100 stocks ranked 101–200, offering exposure to both large- and mid-cap segments. For investors seeking diversification with a mix of stability and growth, the Nifty 200 serves as a valuable reference point.
The Nifty 200 includes 200 actively traded stocks, representing approximately 85–90% of total market capitalization on the NSE. Managed by NSE Indices Limited, the index is checked semi-annually to make sure it is relevant and accurate in reflecting market trends.
Nifty 100: Comprises India’s top 100 companies by market capitalization, reflecting the performance of large-cap stocks.
Nifty Next 50: Includes the next 50 stocks ranked after the Nifty 50, typically comprising emerging mid-cap leaders.
Remaining 50 stocks: These extend the coverage to 200, broadening sector and capitalisation exposure.
The following are some of the key features of Nifty 200:
Heavier weight is given to companies with larger market cap, ensuring size-appropriate influence.
Covers financials, IT, consumer goods, healthcare, industrials, and more.
Stocks with higher trading volumes and liquidity are prioritised for inclusion.
Only publicly available shares are considered in weight calculations, excluding promoter holdings.
Nifty 200 could be useful for investors because of these reasons:
By blending large-cap stability with mid-cap growth potential, the Nifty 200 offers a more balanced investment option compared to narrower indices.
Fund managers and investors use it as a benchmark for diversified equity portfolios, especially for mutual funds or ETFs targeting broad-market representation.
Broader exposure reduces the impact of poor performance from individual sectors or stocks, helping manage volatility.
Nifty 200-based ETFs or index funds replicate the performance of the index, offering low-cost investment avenues for long-term investors.
The use cases of Nifty 200 are as follows:
Retail Investors: Offers a simplified way to track diversified market performance.
Institutional Investors: Helps in allocation strategies, benchmarking, and portfolio risk management.
Portfolio Construction: Index-based products allow investors to design portfolios with minimal active management and lower expense ratios.
The Nifty 200 generally reflects a healthy mix of blue-chip stocks and emerging leaders. While large caps ensure relative stability during downturns, mid-caps can drive higher returns during market rallies.
You can invest in Nifty 200 through the following:
Index Mutual Funds: Several AMCs in India offer Nifty 200-based index funds.
Exchange-Traded Funds (ETFs): Nifty 200 ETFs trade on exchanges like regular stocks.
Direct Stock Investments: Advanced investors can mimic index allocation through individual stocks, though this requires higher capital and monitoring.
The Nifty 200 Index is an essential benchmark that captures a wide swathe of India’s equity market, balancing blue-chip safety with mid-cap momentum. Whether you are a passive investor seeking broad exposure or a financial professional benchmarking portfolio performance, the Nifty 200 offers a reliable and strategic framework.
This content is for informational purposes only and the same should not be construed as investment advice. Bajaj Finserv Direct Limited shall not be liable or responsible for any investment decision that you may take based on this content.
Nifty 50 focuses only on top 50 large-cap stocks, while Nifty 200 includes large and mid-caps, this offers a broad market representation.
Not directly, but you can invest through mutual funds or ETFs tracking the index, or by replicating its portfolio manually.
It is less volatile than mid-cap or small-cap indices due to its large-cap weighting, but more volatile than the Nifty 50 due to mid-cap inclusion.
The index is reviewed and rebalanced semi-annually based on market capitalization and liquidity metrics.
Major sectors include financial services, IT, energy, FMCG, and healthcare, reflecting India’s broader economic landscape.
The Nifty 200 index represents a broad market benchmark that combines the Nifty 100 and Nifty Midcap 100. It reflects performance across large and mid-sized companies, offering a diversified view of India’s equity market across multiple sectors.
The Nifty 200 index includes companies from both the large-cap and mid-cap segments and covers multiple sectors. Its structure reduces concentration in a single segment and reflects wider market behaviour through its diversified constituent base.