The Nifty 500 Multicap 50:25:25 Index follows a structured allocation of 50% large cap, 25% mid cap and 25% small cap stocks at rebalance dates. This approach is designed to maintain exposure across market segments, providing exposure across different market segments, while recognising that returns and volatility may vary over time.
What is the Nifty 500 Multicap 50:25:25 Index?
The Nifty 500 Multicap 50:25:25 Index measures the performance of companies from the Nifty 500 universe while maintaining a defined allocation across market capitalisation segments. It assigns 50% weight to large cap stocks and 25% each to mid and small cap stocks at rebalance dates.
Unlike broader indices where segment weights change fully with market movements, this index restores its allocation periodically. Within each segment, stocks are weighted using free-float market capitalisation, meaning companies with higher publicly available shares receive higher weights.
The index has a base date of 1 April 2005 and a base value of 1000. It is calculated in real time and reviewed periodically as per NSE Indices’ framework.
How does the Nifty 500 Multicap 50:25:25 Index work?
The Nifty 500 Multicap 50:25:25 Index includes all stocks from the Nifty 500 and classifies them into large, mid and small cap segments based on NSE’s framework. At each quarterly rebalance, it assigns 50% weight to large caps and 25% each to mid and small caps.
Within each segment, stocks are weighted using free-float market capitalisation, so companies with higher publicly available market value receive higher weights. Segment weights may shift due to price changes but are reset at the next rebalance.
The index is reconstituted semi-annually and calculated in real time, reflecting ongoing market movements.
Company selection criteria of the Nifty 500 Multicap 50:25:25 Index
The Nifty 500 Multicap 50:25:25 Index follows a structured and rules-based approach for selecting and classifying companies. It does not independently pick stocks, but instead draws all its constituents from the Nifty 500 universe and then assigns them across market capitalisation segments. The index is reviewed periodically as per NSE’s framework to ensure it continues to reflect the defined structure.
Here is how the index is currently distributed across sectors and leading companies, based on the March 30, 2026 factsheet:
Sector representation
| Sector | Weight (%) |
| Financial Services | 28.94 |
| Healthcare | 8.46 |
| Capital Goods | 8.37 |
| Automobile and Auto Components | 7.25 |
| Oil, Gas & Consumable Fuels | 6.47 |
| Information Technology | 6.34 |
| Fast Moving Consumer Goods | 5.22 |
| Metals & Mining | 3.86 |
| Consumer Services | 3.8 |
| Telecommunication | 3.2 |
| Power | 3.16 |
| Chemicals | 3.14 |
| Consumer Durables | 3.06 |
| Construction | 2.71 |
| Services | 2.19 |
| Construction Materials | 1.73 |
| Realty | 1.26 |
| Textiles | 0.38 |
| Media, Entertainment & Publication | 0.31 |
| Diversified | 0.15 |
Top constituents by weightage
| Company Name | Weight (%) |
| HDFC Bank Ltd. | 4.51 |
| Reliance Industries Ltd. | 3.66 |
| ICICI Bank Ltd. | 3.47 |
| Bharti Airtel Ltd. | 2.2 |
| Infosys Ltd. | 1.77 |
| Larsen & Toubro Ltd. | 1.66 |
| State Bank of India | 1.64 |
| Axis Bank Ltd. | 1.34 |
| ITC Ltd. | 1.12 |
| Mahindra & Mahindra Ltd. | 1.06 |
Source: Nifty 500 Multicap 50:25:25 Index Factsheet (March 30, 2026) and NSE Indices Methodology Document; data is subject to change as per periodic review.
What is the difference between the Nifty 500 Multicap 50:25:25 Index and the Nifty 500?
Both indices include the same 500 companies but differ in how they allocate weights across market segments. Here is a structured comparison to help you understand these differences clearly:
| Basis Of Comparison | Nifty 500 Multicap 50:25:25 Index | Nifty 500 Index |
| Universe Base | Includes all companies from the Nifty 500 universe | Includes 500 companies selected as per NSE eligibility criteria |
| Market-Cap Allocation | Fixed allocation of 50% large cap, 25% mid cap and 25% small cap at rebalance | No fixed allocation; weights depend on free-float market capitalisation |
| Weighting Method | Free-float market capitalisation within each segment | Free-float market capitalisation across entire index |
| Segment Behaviour | Segment weights are reset periodically to maintain defined allocation | Segment weights change continuously based on market movements |
| Rebalancing Frequency | Weights rebalanced quarterly and index reconstituted semi-annually | Rebalanced and reconstituted semi-annually |
| Market Representation | Structured multi-cap exposure with defined segment participation | Broad market representation reflecting overall market capitalisation trends |
| Use Case | Used where a predefined multi-cap allocation framework is followed | Used to represent overall market performance without segment constraints |
Potential features of the Nifty 500 Multicap 50:25:25 Index
Understanding how this index is structured can help you evaluate how it maintains balanced multi-cap exposure over time:
Defined allocation framework
Maintains a fixed 50:25:25 allocation across large, mid and small cap segments at rebalance dates.
Broad market universe
Includes all companies from the Nifty 500, covering multiple sectors and industries.
Free-float weighting
Weights stocks within each segment based on publicly available market capitalisation.
Periodic rebalancing
Resets segment allocation quarterly to maintain the defined structure despite market movements.
Transparent methodology
Follows a rules-based framework defined and maintained by NSE Indices.
Real-time market tracking
Reflects ongoing market price movements as it is calculated in real time.
Risks associated with the Nifty 500 Multicap 50:25:25 Index
Understanding these risks can provide perspective on how the index may behave across different market conditions:
Equity market risk
As an equity index, its performance is influenced by overall market movements, economic conditions and changes in corporate earnings.
Mid and small cap volatility
With 50% exposure to mid and small cap stocks, price movements may be sharper during certain market phases.
Rebalancing impact
Quarterly rebalancing may lead to changes in segment weights, which can influence return patterns over shorter periods.
Segment allocation risk
Fixed allocation may limit flexibility to adjust exposure based on changing market conditions.
Tracking difference
Investment products tracking the index may experience minor differences due to expenses, cash holdings or execution factors.
Sector variation risk
Sector weights may shift over time due to price movements and periodic index reviews.
Who may consider investing in the Nifty 500 Multicap 50:25:25 Index?
If you are evaluating this index, it helps to consider your investment horizon and comfort with different market segments:
- This index may be relevant for those seeking exposure across large, mid and small cap stocks within a defined allocation structure.
- Investors who recognise that mid and small cap segments can experience higher volatility may find this framework useful to understand.
- A long-term investment horizon is important when evaluating exposure to an index that includes multiple market-cap segments.
- Those who prefer a rules-based allocation approach may consider how this index maintains fixed segment weights over time.
- It may also be considered as part of a broader strategy to diversify across different segments of the equity market.
How to invest in the Nifty 500 Multicap 50:25:25 Index?
You cannot invest directly in the Nifty 500 Multicap 50:25:25 Index, but you can access it through investment products designed to track its performance:
- Index Funds: Mutual fund schemes may aim to replicate the index by investing in the same stocks in similar proportions, subject to tracking difference.
- Exchange-Traded Funds (ETFs): ETFs tracking the index are listed on stock exchanges and can be bought and sold during market hours, reflecting index movements.
- Investment Modes: When investing through a mutual fund, you may choose between a lump sum investment or a Systematic Investment Plan (SIP), based on your financial plan.
Before investing, it is important to read scheme-related documents carefully and ensure the investment aligns with your overall asset allocation, keeping in mind that returns are subject to market risks and may vary over time.
How does Bajaj Finserv Multi Cap Fund use the Nifty 500 Multicap 50:25:25 TRI?
The Nifty 500 Multicap 50:25:25 TRI serves as the benchmark for Bajaj Finserv Multi Cap Fund and acts as a reference point for evaluating how the portfolio performs over time. Since the TRI version includes reinvested dividends along with price movements, it reflects total return performance of the broader multi-cap market.
That said, the fund is not designed to replicate the benchmark. It follows an active investment approach and builds its portfolio through independent stock selection within the multi-cap universe, which may result in differences in holdings, sector allocation and weight distribution compared to the index.
In essence, while the benchmark provides a structured framework for performance comparison, portfolio construction is guided by the scheme’s investment objective and research-led approach.
FAQs
What does 50:25:25 mean in the Nifty 500 Multicap 50:25:25 Index?
It refers to the index’s target allocation of 50% in large cap stocks and 25% each in mid and small cap stocks, which is restored at every quarterly rebalance.
How is the Nifty 500 Multicap 50:25:25 Index constructed?
The index includes all Nifty 500 companies, classifies them into large, mid and small cap segments, and assigns fixed weights of 50%, 25% and 25% at rebalance dates using free-float market capitalisation within each segment.
Which companies are included in the Nifty 500 Multicap 50:25:25 Index?
All companies that are part of the Nifty 500 Index are included, and the list is reviewed periodically as per NSE Indices’ reconstitution framework.
How often is the Nifty 500 Multicap 50:25:25 Index rebalanced?
The index is rebalanced quarterly to restore segment allocation, while its constituents are reviewed and updated semi-annually.
Are there investment options linked to the Nifty 500 Multicap 50:25:25 Index?
Yes, index funds and ETFs may track this index, allowing investors to access its structure, subject to product availability and tracking differences.
Is the Nifty 500 Multicap 50:25:25 Index suitable for long-term investors?
The index is typically associated with long-term horizons because it includes equity exposure across market caps, where returns and volatility may vary over time.
What are the risks of the Nifty 500 Multicap 50:25:25 Index?
Key risks include equity market volatility, sharper price movements from mid and small cap exposure, and tracking differences when accessed through funds or ETFs.
Can investors invest directly in the Nifty 500 Multicap 50:25:25 Index?
No, the index cannot be invested in directly, but it can be accessed through index funds or ETFs that aim to replicate its composition.
Is the Nifty 500 Multicap 50:25:25 Index a safe investment?
As an equity index, it is subject to market risks, and returns may fluctuate depending on economic conditions and market cycles.
What is the difference between the Nifty 500 Multicap 50:25:25 TRI and PRI?
The TRI (Total Return Index) includes both price changes and reinvested dividends, while the PRI (Price Return Index) reflects only price movements of the index constituents.
Why is the Nifty 500 Multicap 50:25:25 Index used as a benchmark for multi-cap funds?
The index follows a structured 50:25:25 allocation across large, mid and small caps, aligning with SEBI’s multi-cap framework and providing a consistent reference for performance comparison.
