The Nifty 500 is a broad equity index that tracks 500 companies selected from the eligible National Stock Exchange (NSE) universe. It includes large cap, mid cap and small cap companies, giving you a wider view of Indian equities than an index focused only on the largest businesses.
It also serves as a benchmark for investment portfolios. However, holding 500 companies does not mean giving each company the same weight. Understanding that distinction helps you make sense of the index’s movements and the funds that track it.
Source: NSE Indices, Nifty 500 index overview.
Table of Contents
Nifty 500 composition
The Nifty 500 brings together three market-cap segments. The constituent counts below describe its structure, not the percentage of your money invested in each segment.
| Segment | Component index | Number of companies |
| Large cap | Nifty 100 | 100 |
| Mid cap | Nifty Midcap 150 | 150 |
| Small cap | Nifty Smallcap 250 | 250 |
Although small cap companies make up half the constituent count, they do not receive half the index weight. A large company with substantial shares available for public trading can have a much greater influence than several smaller constituents combined.
Source: NSE Indices, Nifty 500 whitepaper, October 2025.
Key Takeaways
- The Nifty 500 covers large cap, mid cap and small cap companies from the eligible NSE universe.
- Companies are selected using full market capitalisation and eligibility rules, while index weights depend on free-float market capitalisation.
- A higher constituent count does not mean equal company weights or equal exposure across market-cap segments.
- The Nifty 500 Total Returns Index includes reinvested dividends, unlike the price return index.
- The Nifty 500 is calculated in real time and reviewed semi-annually.
- Index funds and ETFs provide routes to tracking the Nifty 500, but their returns are affected by market movements, expenses and tracking differences.
Nifty 500 companies and stock weightage
The following companies had the ten largest weights on 31 August 2026. Weights change with share prices and index updates, so this is a dated snapshot rather than a live list.
| Company | Weight |
| HDFC Bank | 5.42% |
| ICICI Bank | 5.20% |
| Reliance Industries | 4.30% |
| Bharti Airtel | 2.75% |
| Larsen & Toubro | 2.36% |
| State Bank of India | 2.19% |
| Infosys | 1.98% |
| Axis Bank | 1.86% |
| Kotak Mahindra Bank | 1.54% |
| Mahindra & Mahindra | 1.46% |
For all constituents, see the official Nifty 500 company list.
Source: NSE Indices, Nifty 500 factsheet, 31 August 2026.
Please note that the reference to any industry/sector/stock is provided for illustrative purposes only. This should not be construed as a research report or a recommendation to buy or sell any security or sector.
Sector weightage in the Nifty 500
Sector exposure is uneven too. These were the six largest sector allocations on 31 August 2026; the remaining weight was spread across other sectors.
| Sector | Weight |
| Financial services | 31.19% |
| Automobile and auto components | 7.60% |
| Healthcare | 7.39% |
| Capital goods | 7.34% |
| Oil, gas and consumable fuels | 6.84% |
| Information technology | 6.49% |
Source: NSE Indices, Nifty 500 factsheet, 31 August 2026.
Please note that the reference to any industry/sector/stock is provided for illustrative purposes only. This should not be construed as a research report or a recommendation to buy or sell any security or sector.
How is the Nifty 500 calculated?
The index uses free-float market capitalisation, which focuses on shares available for public trading. Promoter and other specified strategic holdings are excluded when determining the investible portion.
Full market capitalisation is the share price multiplied by the total outstanding equity shares. Multiplying this by the investible weight factor, or IWF, gives free-float market capitalisation.
Free-float market capitalisation = Share price x Outstanding equity shares x IWF
A company’s weight is its free-float market capitalisation divided by that of all index constituents combined.
Source: NSE Indices, Investible weight factors.
From company values to index points
The combined free-float market capitalisation is converted into an index level using a divisor. The index’s base value is 1,000, with a base date of 1 January 1995.
Index level = Total free-float market capitalisation of constituents ÷ Adjusted index divisor
The divisor is maintained to account for relevant corporate actions and constituent changes. This prevents changes such as adding or removing a company from creating an artificial jump in the index level.
Sources: NSE Indices, Calculation of indices; Nifty 500 factsheet, 31 August 2026.
A weightage example
Suppose a constituent has a free-float market capitalisation of ₹500 crore and the combined figure for the index is ₹10,000 crore. Its weight is 5%.
If that share price rises 10%, with other prices, share counts, free-float factors and the divisor unchanged, its contribution would lift the index by approximately 0.5%. This shows why a heavily weighted company can move the index more than a lightly weighted one.
The figures shown are for illustrative purpose only
How are companies selected and reviewed?
Selection involves more than taking a daily list of the 500 biggest companies. NSE Indices applies size, trading and free-float rules to the eligible universe.
- Size and trading activity: Companies must rank within the top 800 by both average daily full market capitalisation and average daily turnover over the relevant six-month period.
- Liquidity: They must have traded on at least 90% of trading days and meet the prescribed impact-cost limit, which assesses the price effect of executing a trade.
- Free float: Companies must meet the IWF or alternative free-float size requirement.
- New listings: Eligibility for newly listed securities is assessed using one month of data instead of six months.
The index is reviewed semi-annually using data through January and July. Inclusion and exclusion buffers help avoid replacing constituents merely because companies move slightly in the rankings. Corporate events can also lead to changes.
Source: NSE Indices, Methodology document for equity indices, September 2026.
Historical returns of the Nifty 500
Before comparing returns, check whether the figure measures share-price movements alone or includes dividends. The two versions answer different questions.
What does Nifty 500 TRI mean?
Nifty 500 TRI stands for Nifty 500 Total Returns Index. It reflects price movements and the reinvestment of constituent dividends. The price return index reflects price movements without that dividend reinvestment.
For a fund benchmarked to the Nifty 500 TRI, compare its performance with that same total-return benchmark over matching dates. Comparing it with the price index can make the fund’s relative performance look different simply because dividends are treated differently.
Source: NSE Indices, Total return index.
Returns as of 31 August 2026
The figures below use a common endpoint. Year-to-date and one-year figures are absolute returns; the five-year figures are annualised compound returns, or CAGR.
| Period | Price return index | Total Returns Index |
| Year to date | -1.76% | -1.02% |
| One year | 4.40% | 5.34% |
| Five years, CAGR | 10.01% | 11.13% |
Source: NSE Indices, Nifty 500 factsheet, 31 August 2026.
Past performance may or may not be sustained in future
These are index returns, not the returns of a particular mutual fund or ETF. Fund expenses and the way a scheme implements its portfolio can create a difference. An annualised return also does not mean the index delivered that percentage every year.
H2: Nifty 500 vs Nifty 50 and Nifty 100
These indices differ in the breadth of companies they cover. A broader index adds exposure, but it does not promise a higher return or a smaller loss.
| Point of comparison | Nifty 50 | Nifty 100 | Nifty 500 |
| Constituent count | 5000.00% | 10000.00% | ₹ 500 |
| Market coverage | A selected group of large companies | A broader large cap universe | Large cap, mid cap and small cap companies |
| Relationship | Forms part of the Nifty 100 | Combines Nifty 50 and Nifty Next 50 | Includes Nifty 100, Nifty Midcap 150 and Nifty Smallcap 250 |
| Weighting approach | Free-float market capitalisation | Free-float market capitalisation | Free-float market capitalisation |
A Nifty 500 fund can overlap substantially with an existing Nifty 50 fund. Adding it to your portfolio does not automatically create an entirely separate set of investments. Check the combined holdings and weights before deciding how much additional exposure you need.
Source: NSE Indices, Nifty 500 whitepaper, October 2025.
Benefits of investing through a Nifty 500 index fund
A fund tracking the index offers a practical way to hold a broad basket of equities. Its main benefits come from access and a defined investment process.
- Broad exposure: One fund provides exposure across company sizes and sectors, reducing reliance on a handful of businesses.
- A rules-based portfolio: Holdings follow the benchmark’s construction rather than a fund manager’s discretionary stock selection.
- Simpler administration: The fund handles portfolio transactions and index changes, so you do not have to manage hundreds of individual holdings yourself.
- A clear comparison point: You can assess the fund against its stated benchmark and examine the cost of tracking it.
These benefits do not make every tracking fund equally efficient. Check expenses and tracking quality rather than choosing only by the index name.
Source: SEBI Investor, Index mutual funds.
Risks and limitations of the Nifty 500
A broad index can still fall sharply. The number of holdings is only one part of understanding the risk you are taking.
- Market risk: A widespread equity-market decline can affect many constituents at the same time.
- Concentration risk: Larger companies and heavily weighted sectors have a greater influence on returns, despite the long constituent list.
- Smaller-company exposure: Mid cap and small cap holdings can experience sharp price changes and periods of lower liquidity.
- No protection from a falling market: A tracking fund follows its mandate; it does not promise to move out of equities before prices fall.
- Implementation risk: Expenses, cash balances and trading can cause a fund’s return to differ from its benchmark.
Money needed for a near-term expense may leave you unable to wait through a market decline. Consider your goal, investment horizon and ability to tolerate losses before choosing an equity allocation.
How to invest in the Nifty 500
You cannot buy the index itself. You can invest through a scheme that tracks it, such as a Nifty 500 index fund or ETF. Confirm the exact benchmark in the scheme documents, because similarly named indices can use different weighting rules.
| Point of comparison | Nifty 500 index fund | Nifty 500 ETF |
| Buying and selling | Transactions through the fund or an investment platform at the applicable NAV, subject to rules | Units bought and sold on a stock exchange at market prices |
| Account requirement | Non-demat investment is generally available | Retail exchange transactions generally require demat and trading accounts |
| Regular investing | An SIP may be available under the scheme’s terms | Recurring purchases depend on the broker’s facility and market execution |
| Costs to check | Expense ratio and any applicable exit load | Expense ratio, brokerage, bid-ask spread and applicable account charges |
| Additional consideration | Processing and NAV applicability rules | Trading liquidity and whether the market price differs from NAV |
Sources: SEBI Investor, Index mutual funds and Exchange traded funds.
Before investing, read the scheme’s objective, riskometer, expenses and tracking disclosures. Tracking difference is the return gap between the fund and its benchmark over a period. Tracking error measures how much the difference in periodic returns varies. Both help you assess tracking quality.
Source: SEBI Investor, Understanding tracking error.
An actively managed fund that uses the Nifty 500 as its benchmark is different from a fund that aims to replicate it. The active fund can hold a different portfolio in pursuit of its investment objective.
FAQs
Can I start an SIP in the Nifty 500?
You can start an SIP in a mutual fund scheme that tracks the Nifty 500 if the scheme offers that facility. The minimum instalment and available frequencies depend on its terms. An SIP is a way of investing regularly; it does not guarantee a profit or prevent losses.
Does the Nifty 500 include every company listed on the NSE?
No. It covers 500 selected companies from the eligible universe. Other NSE-listed companies fall outside the index, and constituents can change following reviews or corporate events.
Is the index level the amount needed to invest?
No. An index level is measured in points, not the rupee price of a fund unit. The amount you need depends on the fund’s minimum investment requirement or the ETF’s traded unit price and applicable charges.
Is Nifty 500 the same as Nifty500 Multicap 50:25:25?
No. The standard Nifty 500 uses free-float market-cap weights. Nifty500 Multicap 50:25:25 assigns 50% to large cap, 25% to mid cap and 25% to small cap segments on quarterly rebalance dates. Those different allocations can lead to different performance.
