The ETF gives equal weight to each stock in the Nifty 50, aiming to reduce over-reliance on a few large companies and provide more diversified exposure across sectors.
Mirae Asset Mutual Fund has announced the launch of a new exchange-traded fund that follows the Nifty50 Equal Weight Total Return Index. This fund assigns the same weight to every stock in the Nifty 50, offering a different approach from traditional index investing, where larger companies dominate the portfolio.
The New Fund Offer opens on April 30 and will be available for subscription until May 6. It will reopen for daily transactions from May 12. The fund sets a minimum initial investment of ₹5,000 during the offer period, followed by investments in multiples of ₹1.
The Nifty50 Equal Weight Index is maintained by NSE Indices, a subsidiary of the National Stock Exchange of India. This index gives approximately 2 percent weight to each of the 50 companies. The idea is to avoid the concentration risks that come with standard market cap indices, where a handful of large players often decide the overall movement of the index.
Unlike the traditional Nifty 50, where companies like Reliance Industries, Infosys, and HDFC Bank tend to have a much larger influence, the equal weight version spreads investor exposure more evenly. This structure also allows relatively smaller companies in the Nifty 50 to contribute more meaningfully to performance.
Ekta Gala and Akshay Udeshi will manage the fund. Both have experience handling passive investment strategies and ETFs at Mirae Asset.
Siddharth Srivastava, Head of ETF Products at Mirae Asset Investment Managers (India), said the equal weight strategy is meant for investors who want a more balanced view of the index. He noted that this model may work particularly well when the market is broad-based and not dominated by a few large-cap stocks.
Srivastava added that the fund aims to offer simple, rule-based investing for those who want to avoid bias and overexposure to any one stock. He said the structure also reflects how investors can benefit from a more distributed performance profile over time, especially during economic cycles that favour a wider set of companies.
The Nifty50 Equal Weight Index is rebalanced twice a year. Each quarter, the stock weights are reset to 2 percent, which keeps the index in line with its intended structure. This semi-annual rebalancing ensures that stocks do not drift too far from their target weights, regardless of how they perform during the cycle.
This strategy might appeal to those who believe in India’s large-cap universe but are looking for a slightly more diversified route than traditional index funds provide. It also opens up potential advantages when markets are rising across sectors and not just in blue-chip names.
Mirae Asset Investment Managers (India) is part of the Mirae Asset Global Investments Group, which has a presence in over a dozen countries. The Indian arm has built a strong lineup of thematic, sectoral, and passive investment products over the years.
According to AMFI, the market for ETFs in India has seen rapid growth, particularly as more retail investors and institutions move toward passive, low-cost models. Products like equal-weighted ETFs are expected to play a growing role in that shift.
Investors looking to enter the market during this NFO should review the scheme document carefully. As with any market-linked product, past performance of the index or similar funds is not a guarantee of future returns. However, for those wanting exposure across all sectors without the usual weightings, this new ETF may offer a relevant alternative.
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For further details or scheme-related documents, visit the official Mirae Asset Mutual Fund website or speak to a registered financial advisor.
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