1W Return
▼-2.35%
1M Return
▼-2.71%
6M Return
▲11.38%
1Y Return
▼-2.30%
3Y Return
▲57.51%
Open
9226.9
Prev. Close
9210.5
| Company | Market Cap | Market Price | Sector |
|---|---|---|---|
62,849.50 | 762.95 -43.50 (-5.39%)▼ | Steel | |
22,206.24 | 842.40 -31.80 (-3.64%)▼ | Steel | |
96,479.93 | 945.80 -18.90 (-1.96%)▼ | Steel | |
67,449.12 | 1,288.80 -17.70 (-1.35%)▼ | Mining & Mineral products | |
2,59,078.95 | 2,244.70 -30.50 (-1.34%)▼ | Trading |
What is Nifty Metal?
Nifty Metal is a sectoral equity index developed and maintained by the National Stock Exchange (NSE) of India. It tracks the performance of the leading metal and mining stocks listed on the NSE, giving a collective picture of the Indian metals sector. Nifty Metal includes firms engaged in the production and processing of metals such as steel, aluminium, copper, zinc and other valuable minerals, as well as those engaged in mining and metal-related activities. The index covers a diverse range of businesses, from large integrated steel producers and non-ferrous metal manufacturers to mining and mineral exploration companies.
The Nifty Metal index is widely regarded as the key barometer for measuring the health and direction of India’s metals and mining industry, which is integral to the country’s industrial and infrastructure growth. The index acts as a crucial tool for investors, analysts, and fund managers who wish to gain insights into the sector’s trends, risks, and investment opportunities. It is also commonly used as a benchmark for metal sector mutual funds, exchange-traded funds (ETFs), and portfolio performance.
By tracking Nifty Metal, market participants gain exposure to the most significant players in the Indian metals industry, enabling them to align their investments with the broader cycles and prospects of the metals and mining sector.
Nifty Metal stocks selection criteria
The selection criteria for inclusion in the Nifty Metal index are both rigorous and transparent, ensuring that the index accurately represents the performance of the metals sector. To be eligible, a stock must be listed and actively traded on the NSE and classified under the metals or mining sector according to the Industry Classification Benchmark (ICB). The company must also be part of the Nifty 500 universe, which consists of the top 500 companies by market capitalisation and liquidity.
The next step involves evaluating stocks by their average free-float market capitalisation over a six-month period. Free-float market capitalisation excludes shares held by promoters, government, and strategic investors, focusing instead on shares available for public trading. Liquidity is a critical parameter; stocks must exhibit a minimum trading frequency and average daily turnover during the review period.
The Nifty Metal index is typically composed of the 15 most liquid and largest metal sector companies based on these parameters. The index undergoes a semi-annual review, during which stocks that no longer meet the eligibility criteria may be replaced by more qualified candidates. This ensures the index remains current, representative, and reflective of sectoral shifts or emerging leaders. The selection methodology not only ensures efficient tradability but also provides investors like you with exposure to the most relevant and actively traded metal companies in India’s dynamic industrial landscape.
How is the Nifty Metal index calculated?
The Nifty Metal index is calculated using the free-float market capitalisation weighted methodology, which ensures that the influence of each constituent stock is proportional to its free-float market value. The free-float market capitalisation is determined by multiplying the latest traded price of a stock by the number of shares available for public trading (excluding holdings by promoters and strategic investors).
The sum of the free-float market capitalisations of all constituent stocks forms the numerator in the index calculation. This aggregate is then divided by a base market capitalisation, which is a fixed value set at the index’s inception and adjusted for any corporate actions such as stock splits, bonus issues, or rights issues. The index is calculated using the formula:
Index Value = (Sum of Free-Float Market Capitalisation of All Constituents) / Base Market Capitalisation × Base Index Value (usually 1,000)
This method ensures the index remains unaffected by changes in the number or structure of shares due to corporate events. The Nifty Metal index is calculated in real time using the latest traded prices of its constituents and is reviewed and rebalanced semi-annually. This robust calculation approach ensures that the index provides an accurate, dynamic, and transparent reflection of the Indian metals sector’s performance, making it a reliable benchmark for investors and market observers.
Nifty Metal FAQs
How to invest in Nifty Metal?
Investment in Nifty Metal can be made through sectoral mutual funds or exchange-traded funds (ETFs) that specifically track the Nifty Metal index. These investment products are available via stockbrokers, mutual fund distributors, and online trading platforms. Alternatively, you can construct a portfolio by directly purchasing shares of the index’s constituent companies, but this approach requires active management and periodic rebalancing to mirror the index.
What is the objective of Nifty Metal?
The primary objective of the Nifty Metal index is to provide a transparent and reliable benchmark for tracking the performance of India’s top metal and mining companies. The index aims to capture sector-specific trends and serve as a reference for fund managers, analysts, and investors seeking exposure to the metals sector, facilitating informed investment decisions and portfolio benchmarking.
Is investment in Nifty Metal safe?
While Nifty Metal includes some of the largest and most liquid metal and mining companies in India, investments in the sector are inherently cyclical and subject to commodity price volatility, global demand-supply dynamics, and regulatory changes. As a sectoral index, it carries higher risk compared to diversified indices, so you should assess your risk tolerance, diversify your portfolios, and consider a long-term investment horizon to manage volatility.
Benefits of investing in Nifty Metal
Investing in Nifty Metal offers investors like you exposure to India’s robust metals and mining sector, which is crucial for the country’s industrial and infrastructure growth. The index provides access to a diversified mix of leading companies across the metals value chain, enabling potential for capital appreciation during sector upcycles. Its high liquidity ensures ease of trading, while the transparent methodology ensures efficient benchmarking for both active and passive investment strategies.