NSE Indices, a subsidiary of the National Stock Exchange (NSE), which manages a portfolio of indices under the Nifty brand, on Thursday launched a new index — Nifty Midcap150 Quality 50 index.
The new smart-beta mid-cap index will include the top 50 companies from the Nifty Midcap 150 index, which will be selected based on their ‘quality scores’.
The score is to be calculated based on factors such as return on equity (RoE), financial leverage (except for financial services companies) and earnings per share (EPS) growth for each of the 50 companies over the past five financial years. Financial leverage refers to a company using borrowed money or debt to finance assets.
The base date for the index is set at April 01, 2005, with a base value of 1,000. The index composition would be reconstituted on a semi-annual basis.