NSE Indices Ltd, an arm of the National Stock Exchange (NSE), on Tuesday (March 11) launched the Nifty Chemicals Index, a sectoral index designed to track the performance of chemical sector stocks within the Nifty 500.The index comprises the top 20 stocks based on a six-month average free float market capitalization, with a preference given to stocks available for trading in NSE’s derivatives segment.
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The index follows a free float market capitalisation-weighted methodology, capping individual stock weight at 33% and the combined weight of the top three stocks at 62%. The base date for the index is April 1, 2005, with a base value of 1000. It will be reconstituted semi-annually and rebalanced quarterly.
The Nifty Chemicals Index is expected to serve as a benchmark for asset managers and act as a reference for passive investment products, including exchange-traded funds (ETFs), index funds, and structured products.
