Nifty Microcap 250 Index Performance

Recently NSE India launched the Nifty Microcap 250 Index, which includes the top 250 companies beyond the Nifty 500 index constituents.

Performance of Nifty Microcap 250 Index vs Nifty Smallcap 250 Index:

Since inception, the Nifty Microcap 250 Index has outperformed the Nifty Smallcap 250 Index, returning 16.2% CAGR return against 15.5% CAGR for the Nifty Smallcap 250 Index.


But the key point is the volatility of the index. The Nifty Microcap 250 Index has been more volatile
than the Nifty Smallcap 250 Index over various time horizons.

Also, the index suffered maximum drawdown during the GFC (Global Financial Crisis) of 2008-09. The maximum drawdown for the Nifty Microcap 250 Index was -78.9% compared to 63.7% for the Nifty 500 Index.

There are over 1600 stocks listed in NSE compared to 900 in 2006. As the economy grows, the stock universe expands, as newer companies get listed. This is a good start from NSE in launching the Nifty Microcap 250 index, as it expands the coverage of the listed universe.

There are no Index fund or Active fund benchmarking to this index, as the index was launched recently.
Expect some AMC to launch a microcap fund based on this index.