NIFTY Midcap 150

Trying to grow your money but not sure where to invest after large, well-known companies? Worried that small companies feel too risky or unstable? Many investors feel stuck in the middle. That “middle” is exactly what the NIFTY Midcap 150 index helps you explore.

This index tracks 150 medium-sized Indian companies that sit between the market giants (large caps) and the tiny, more volatile players (small caps). These companies are ranked 101 to 250 by full market capitalisation within the broader NIFTY 500 Index, which means they’ve already crossed an important scale threshold but still have room to grow. For those looking to move beyond the usual top companies but not ready for small-cap swings, this index offers a steady entry into India’s mid-cap growth story. Start SIP journey with Rs. 100

Because it represents a wide slice of India’s growing businesses, the NIFTY Midcap 150 is often used as a barometer for the mid-cap segment of the stock market. It includes companies from multiple sectors and gives each a different weight based on size, so you don’t end up overexposed to just one industry. As on September 29, 2023, the index accounted for about 15% of the free-float market capitalisation of all NSE-listed stocks, showing how meaningful the mid-cap space is within India’s markets.

Understanding NIFTY Midcap 150

The NIFTY Midcap 150 is made up of 150 mid-sized companies in India, ranked 101st to 250th by market capitalisation. That rank is based on their place within the NIFTY 500 universe, so every company here has already passed basic size, listing, and liquidity filters. When you invest in this index, you’re tracking how this entire band of medium-sized businesses performs in the stock market.

Market capitalisation, put simply, is the total value of a company on the market: share price × number of shares. In broader measures, this count can include promoter- or government-held shares. The NIFTY Midcap 150 selection process uses that ranking to identify which companies fall into the “mid” bucket. If you're exploring mid-cap investments but prefer a diversified route over researching 150 stocks individually, this index structure offers a simplified yet balanced approach. Compare mutual fund plans instantly

What makes this index useful is its built-in diversification across sectors. Instead of trying to pick a handful of mid-cap stocks yourself, you get a structured basket spread across industries, which can help reduce the risk that comes from one company or one sector doing poorly. These are companies that are often in expansion mode—scaling products, growing revenue, improving profitability, or increasing market share—so investors participate in that stage of growth.

How weightage of different companies and sectors in NIFTY Midcap 150 is decided

When you look at any index like NIFTY Midcap 150, you might wonder—how much does each company matter in the overall performance? The answer lies in something called free-float market capitalisation.

In simple terms, free-float market cap is calculated by taking a company’s stock price and multiplying it by the number of shares that are available for public trading (not those locked up by promoters or the government). The bigger this number, the more weight that company gets in the index.

So, larger mid-cap companies those with more freely traded shares get a higher share of the index's movement. The same rule applies to sectors: if a sector has many companies with higher free-float market caps, that sector will carry more weight in the index.

This method ensures the index reflects the true activity of mid-sized companies in the market and doesn’t get distorted by a few big names.

How to invest in the NIFTY Midcap 150 index

If you’re interested in the mid-cap segment and want to invest in the NIFTY Midcap 150, there are several ways to get started—some simple, others requiring more effort. Here are the main options:

• Exchange-Traded Funds (ETFs): These are mutual funds that trade like stocks on an exchange. There are ETFs that are designed to mirror the performance of the NIFTY Midcap 150. You can buy and sell them throughout the trading day—just like any regular stock. They’re flexible, transparent, and easy to access through platforms like Bajaj Finserv.

• Mutual Funds: Some index mutual funds specifically track the NIFTY Midcap 150. These funds are managed by Asset Management Companies (AMCs), and you can invest in them either directly through the AMC or via investment platforms such as Bajaj Finserv. For most investors, mutual funds and ETFs offer a more accessible and less time-intensive way to invest in this index, compared to building a portfolio of all 150 stocks. Open your MF account now

• Direct Stock Investment: For experienced investors, another option is to buy the stocks of all 150 companies individually in the same proportions as the index. But this route demands a large investment amount, deep research, and regular monitoring. It’s not ideal for beginners or passive investors.

Performance comparison: NIFTY Midcap 150 vs other indices

Let’s look at how the NIFTY Midcap 150 has actually performed when compared to other popular indices over different time periods. This gives a clearer picture of the risk-reward balance you’re stepping into.

(As on 31st July 2023. Source: nseindia.com)

As you can see, over a 10-year period, the NIFTY Midcap 150 has outperformed most of the other indices. Even its 5-year and 15-year returns look strong compared to the large-cap focused NIFTY 50 and the more volatile NIFTY Small Cap 250.

This performance trend makes it clear: mid-cap stocks have historically offered better returns over the long term, though they come with slightly higher risk than large caps. If you can stay invested through market cycles, this index can offer healthy wealth creation potential.

What are the returns of NIFTY Midcap 150 index over the years?

Before investing in any index, it’s important to see how it has performed historically. While past returns don’t guarantee future results, they help set realistic expectations about the index’s behaviour over time.

Here’s a snapshot of the NIFTY Midcap 150’s performance:

The price return reflects only the change in stock prices, while the total return includes dividends. As you can see, the index has delivered solid long-term growth, especially over 10 years and since launch.

What this means is: while mid-caps can face short-term ups and downs, investors who stay invested longer tend to see better compounded returns, making the NIFTY Midcap 150 a strong option for long-term wealth creation.

Key benefits of NIFTY Midcap 150 funds

Investing in the NIFTY Midcap 150 through mutual funds or ETFs gives you access to a group of companies with high growth potential. Here’s what makes this segment appealing:

• Long-term growth: Mid-cap companies are often in their expansion phase. They’re not too big to grow slowly, and not too small to be unstable. Over the past 15 years, this index has shown an average annual return of 16.5%, proving its resilience despite market ups and downs.

• Demonstrative returns: Want to know how that growth translates into actual wealth? Let’s say you invest Rs. 10,000 every month for 15 years in a NIFTY Midcap 150 index fund. By March 2024, that amount could have grown to over Rs. 78 lakh. This shows what disciplined, long-term investing in the mid-cap space can deliver.

Such long-term illustrations highlight how consistent exposure to mid-cap indices, via disciplined investing, can build substantial wealth over time. Track top-rated mutual funds

Strategies for investing in NIFTY Midcap 150

Now that you know what the index offers, let’s look at how you can approach investing in it. There are multiple strategies—some straightforward, some more advanced:

• Conventional methods: The most common way is to invest through index funds or ETFs that mirror the NIFTY Midcap 150. These give you direct exposure to the index, and your returns will closely follow its performance. While simple and cost-effective, this route doesn’t allow you to outperform the index—it just matches it.

• Genius approach (like ET Money Genius): Some platforms offer enhanced strategies that still include the NIFTY Midcap 150 but combine it with exposure to other indices and asset classes. The goal here is not just to match the index, but to create more balanced or aggressive portfolios that can adjust over time.

• Dynamic asset allocation: This is the real edge of the genius model. Based on market trends and your personal risk level, your money is allocated across mid-cap funds, large caps, debt, or even gold. This method helps you capture gains during market rallies, while reducing losses during market falls.

Who should invest in NIFTY Midcap 150?

The NIFTY Midcap 150 is not for everyone—but if you fall into any of the below investor types, this index might be a great fit for your goals:

• Risk-tolerant investors: Mid-cap companies are more volatile than large-cap firms, but less unpredictable than small caps. If you can handle a bit of up and down in the short term, this space offers higher long-term potential.

• Diversification seekers: Instead of buying individual mid-cap stocks, investing in the NIFTY Midcap 150 gives you exposure to 150 companies across multiple sectors. This spreads your risk and gives you a more balanced experience.

• Long-term investors: If your goals are 7 years or longer—like planning for a child’s education or your retirement—this index gives enough time for short-term market movements to smooth out and for returns to compound.

• Growth-focused investors: Want higher potential than what large-cap indices offer, but aren’t ready for the sharp swings of small caps? The NIFTY Midcap 150 can offer a balanced middle ground.

• Moderate-risk investors: If you’re looking for more growth than fixed income or large caps, but still want to avoid extremely high-risk bets, this index may offer that sweet spot.

If you identify with any of these profiles, a well-structured midcap fund could help you gain diversified exposure without needing to manage individual stocks. Explore funds with consistent returns

What makes midcap funds better than large cap funds?

Large-cap funds tend to invest in well-established, stable companies—but midcap funds have their own strengths, especially when it comes to potential returns and sector diversity. Here’s why some investors prefer mid-cap exposure:

• Broader sector exposure: Mid-cap funds usually spread their investments across a wider range of sectors than large-cap funds. This gives your portfolio a healthier mix and helps reduce the risk of over-reliance on one industry.

• Domestic growth focus: Many mid-cap companies cater to India’s growing domestic economy. Unlike large-cap companies that often depend on global demand, mid-caps are deeply tied to local markets. This gives them room to grow in line with India’s economic momentum.

Conclusion

The NIFTY Midcap 150 mutual fund category gives you exposure to a high-growth space within the Indian stock market. These companies sit between the stability of large caps and the aggression of small caps, offering a balanced path to growth.

Whether you're looking to diversify, grow your wealth steadily, or just want access to a structured basket of medium-sized businesses, the NIFTY Midcap 150 offers a practical route. But like all investments, it’s important to align your choice with your goals, risk appetite, and investment timeline.