Nifty Midsmallcap400 Momentum Quality 100 Share Price

The Nifty Mid Small Cap 400 Momentum Quality 100 index is a factor-based index tracking stocks using a combination of momentum and quality factors. It is managed by the NSE.

The index selects 100 stocks from the Nifty Mid Small Cap 400 universe based on momentum and quality scores.

Momentum scores are derived from 6-month and 12-month price returns adjusted for volatility, while quality scores are based on return on equity (ROE), financial leverage, and earnings growth variability.

The Nifty Mid Small Cap 400 Momentum Quality 100 Index follows a factor-based selection process using momentum and quality scores.

1. Step 1: Universe Definition

   
   Stocks are selected from the Nifty Mid Small Cap 400 index.

2. Step 2: Eligibility Filters

   
   Stocks are excluded if:
   • Non-F&O stocks hit upper/lower circuit limits on 20% or more trading days in the last 6 months.
   • Promoter pledge exceeds 20%.
   • Stocks fall in the bottom 10th percentile based on turnover ratio within the midcap or smallcap segments.
   • Stocks fall in the bottom 10th percentile based on the 6-month average daily turnover.

3. Step 3: Momentum Score Calculation

   
   Momentum score is calculated using:
   • 6-month price return
   • 12-month price return
   • Volatility adjustment

4. Step 4: Quality Score Calculation

   
   Quality score is calculated using:
   • Return on Equity (ROE)
   • Financial Leverage (Debt/Equity Ratio)
   • EPS growth variability over the previous 5 years.

5. Step 5: Ranking Process

   
   Eligible companies are ranked based on aggregate percentile scores combining momentum and quality factors.

6. Step 6: Final Inclusion

   
   The top 100 stocks from the eligible midcap universe and the top 50 stocks from the eligible smallcap universe are selected to form the 100-stock index.

The index is calculated using a factor-weighted free-float market capitalization methodology.

1. Step 1: Free-float Market Cap Calculation

   
   Free-Float Market Cap = Free-Float Shares x Current Market Price (Excluding Promoter Holdings).

2. Step 2: Composite Factor Score Calculation

   
   The next step is to assign a combined score to each stock based on:
   • Momentum factor score
   • Quality factor score

3. Step 3: Weight Assignment

   
   Stock weight is derived by multiplying: Free-float market capitalization x composite momentum-quality score.

4. Step 4: Weight Caps Applied

   
   Individual stock weights are capped at 5% during rebalancing.

5. Step 5: Index Value Calculation

   
   The weighted free-float market capitalization of all constituents is aggregated to derive the index value.
   • Index Value = (Current Free-Float Market Cap / Base Market Cap) x Base Value

6. Step 6: Adjustments & Continuity

   
   Corporate actions such as stock splits, bonus issues, mergers, and rights issues are adjusted to maintain index continuity.

7. Step 7: Review & Rebalancing

   
   Semi-annual rebalancing is conducted in June and December. Average six-month data ending on the cut-off date is considered for review.

Let's look at some benefits of investing in Nifty Mid-Small Cap 400 Momentum Quality 100:

• Dual Factor Exposure: Combines both momentum and quality factors within a single index framework.
• Midcap & Smallcap Representation: Tracks companies across mid-cap and small-cap segments.
• Rules-Based Selection Process: Uses predefined filters for liquidity, volatility, and promoter pledge levels.
• Factor-Weighted Methodology: Weights stocks using a combination of factor scores and free-float market capitalization.
• Diversification Across Segments: Includes companies from multiple sectors within the broader mid-cap and small-cap universe.
• Benchmark for Smart Beta Strategies: Can be used for benchmarking ETFs, index funds, and factor-based portfolios.

With Anand Rathi's TradeMobi platform, investing in the NSE indices is simple.

Here's how to get started:

1. Step 1: Open / Login to Your Account

   
   Start by registering yourself and opening your demat account and trading account.

2. Step 2: Explore Investment Options

   
   Look for smart beta funds, ETFs, or factor-based products linked to the index.

3. Step 3: Choose Your Investment

   
   Pick a suitable option based on your understanding of momentum and quality investing.

4. Step 4: Invest and Track

   
   Monitor the Nifty MidSmallcap 400 Momentum Quality 100 share price and constituent changes regularly.

5. Step 5: Stay Updated

   
   Track momentum trends, earnings quality, and market volatility affecting the index.

On February 8, 2024, the Nifty MidSmallcap 400 Momentum Quality 100 index was introduced to track selected mid-cap and small-cap companies using momentum and quality factors.

It was created as part of the growing use of factor-based investing in the Indian stock market. The index combines companies showing strong price trends with businesses having better financial quality indicators.

Over time, the index has become a benchmark for smart beta products such as ETFs and index funds focused on momentum and quality investing strategies.

Also, the index is reviewed and rebalanced periodically to reflect changes in market trends and company fundamentals.