Nifty Midcap 150 is an index many investors want to get their hands on. The companies in this index could have great unexplored growth potential and could give you significant investment growth. However, some investors tend to stay away from such indices due to concerns related to quality. These investors might be inhibited by some of these companies’ quality and growth prospects. But is there any way to use the growth of good quality companies in the index and avoid doing the rest? Let’s find out!
NIFTY midcap 150 quality 50 index
Midcap indices are an interesting area in stock markets today, and Nifty’s midcap 150 quality 50 indexes could be the answer you are looking for here. It is an index based on the original NIFTY midcap 150 index, sorted by a quality score. The quality score is determined by the index based on several performance parameters, like a company’s return on equity, financial leverage, and earnings per share growth for the past five years.
The weightage of each stock in the NIFTY midcap 150 quality 50 indexes is based on this quality score.
Since the quality of the midcap companies is assessed like this and added to the grade 50 indexes based on weightage granted by the quality score, investors can rule out their concerns about quality and leverage the growth potential of these companies. This makes a good list of stocks to buy today. Let’s examine six reasons that could prove that the midcap index is worth a shot.
Potential to grow
As said above, the companies in this index are mostly yet to be explored and could be future leaders. Investing in them can pre-book your spot to maximize this potential growth.
Easy to Invest
The index is also easy to invest in. Several funds and ETFs track it, and you can invest in them with just a single click.
Zero bias strategy
The weightage and stock selection of Nifty’s midcap 150 quality 50 index are completely based on the quality score. That means the fund manager is very limited in its involvement.
Lower expense ratio
Since the fund is not actively managed, the expense ratio associated with the fund is low. A higher expense ratio could offset the profits earned, and in the case of the Nifty midcap 150 quality 50 indexes, that concern is invalid.
Affordable
Buying each company’s stock in the index will cost you much more than investing in a fund or ETF that follows the index, making it much more affordable.
Past performance
Although past performance need not indicate how the fund will perform in the future, Nifty Midcap 150 quality 50 has a good history and underlines the index’s growth potential.
Conclusion
Happy investing! Nifty Midcap 150 Quality 50 is worth a shot, especially when investing in it is easy. However, ensuring that investing in this index aligns with your investment goals and risk appetite is equally important. To ensure this, you can consult a financial expert who will work with you to help you identify your investment horizon, and they can even help you figure out the stocks to invest in.
