Your Questions Answered: What is Nifty MidSmall Healthcare Index and how is it different from Nifty Healthcare Index?

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Sameer Prajapati, Greater Kailash - 2, Delhi, India The Nifty MidSmall Healthcare Index is a specialised index that offers investors a snapshot of the midcap and smallcap segments of India's burgeoning healthcare sector. This index is meticulously designed to track the performance of companies that are considered mid-sized or small-sized in terms of market capitalization, providing a unique perspective on a vital part of the economy. The index is composed of up to 30 stocks, selected based on their free-float market capitalization.

This method ensures that only the shares available for trading are considered, offering a more accurate reflection of market movements. The Nifty MidSmall Healthcare Index is a subset of the broader Nifty MidSmallcap 400 index, which includes a wider range of mid and small cap stocks across various sectors. The Nifty MidSmall Healthcare Index stands as a testament to the dynamic nature of the healthcare industry.

The index has a base date of April 01, 2005, and started with a base value of 1000, which allows investors to track its performance over time. The weight of each stock in the index is determined by its free-float market capitalization, ensuring that the index is balanced and representative of the sector's performance. The index is reconstituted semi-annually and rebalanced quarterly to reflect the changing landscape of the healthcare sector.

This includes adding or removing stocks to ensure the index remains relevant and up-to-date. The weight of no single stock can exceed 33%, and the weights of the top three stocks cumulatively cannot be more than 62% at the time of rebalancing, which mitigates the risk of over-concentration. The performance of the Nifty MidSmall Healthcare Index is