What is Nifty Next 50 index fund

Nifty Next 50 is an index of the 50 largest companies listed on the NSE after the Nifty 50. An index fund tracking it lets you invest in these potential future large-cap companies in one go.

Why it exists

The index captures the performance of 'next-in-line' companies that could enter the Nifty 50. It offers exposure to mid-to-large cap stocks that are growing.

Who manages it

NSE Indices constructs and maintains the Nifty Next 50 using objective rules. Fund houses create index funds or ETFs that passively track that index.

How an index fund works

An index fund buys the same stocks in the same proportions as the Nifty Next 50. It aims to match the index return, keeping costs low since it’s passively managed.

Key benefits

Diversification across 50 companies reduces single-stock risk. Low expense ratios compared with active funds make it cost-efficient. Good for investors seeking growth exposure beyond large caps.

These stocks can be more volatile than Nifty 50 members. Sector concentration and market cycles may affect returns. Index composition changes periodically.

Potential risks

Investors looking for long-term growth, those comfortable with higher volatility than top large-cap funds, and anyone wanting a one-step way to own a diversified basket of emerging large caps.

Who should consider it

How to invest

Search for an index fund or ETF that tracks Nifty Next 50. Compare expense ratio, tracking error, and fund size. You can buy through brokers, mutual fund platforms, or directly from fund houses.

Monitoring tips

Check tracking error, fund flows, and index reconstitution dates. Rebalance in your portfolio only if overall allocation drifts from your target.

Quick recap

Nifty Next 50 offers diversified exposure to companies likely to become tomorrow’s large caps. It’s a low-cost way for investors to ride mid-to-large cap growth, with slightly higher volatility.