Remember the scene from the school relay competition where one star runner always grabbed the spotlight, but when every team member of the opposite team ran equal laps, they won more often. Turns out, balance sometimes beats brilliance alone.
Retail investors in India often turn to the Nifty 50 when seeking . But there’s a lesser-known cousin that also deserves attention: the . It selects the top 15 companies (by 6-month average free-float market cap) from within the Nifty 50 and assigns each of them equal weight, rather than letting the largest players dominate the index. This seemingly small shift in approach can lead to meaningful differences.
Equal weighting logic
Traditional indices like the Nifty 50 are market-cap weighted. It means companies with larger market capitalisations exert more influence on index movements.
The Equal Weight Index takes a different path. It currently allocates roughly 6.1% to 7.2% weight per stock, offering more balanced exposure across constituents. This method reduces over-reliance on a few dominant players and gives each company a proportionate voice and place in index performance.
From a sector perspective, the Nifty Top 15 Index has exposure to seven key sectors, reflecting a broad base of leadership across the Indian economy. Here’s how it compares to the Nifty 50.
As on May 26, 2025 data, financial services make up the largest portion in both indices, with a slightly higher allocation in the equal weight index at 39.7% compared to 37.3% in the Nifty 50. The automobile and auto components sector has a significantly higher share at 13.8%, as against 7.2% in the Nifty 50. Similarly, fast-moving consumer goods (FMCG) account for 13.6% of the equal weight index, almost double the 7.0% in the Nifty 50.
Telecommunication and construction sectors also see an uplift, with weights of 6.8% and 6.7% respectively, compared to 4.4% and 3.8% in the Nifty 50. On the other hand, the equal weight index does not include sectors like healthcare, metals and mining, power, consumer durables, and services etc., all of which are present in the Nifty 50 with allocations ranging from 0.9% to 3.6%. This tilt makes it more concentrated in consumer-facing and infrastructure-related sectors, potentially offering more earnings stability during volatile periods.
Returns, volatility, and valuations
The Nifty Top 15 Equal Weight TRI outperformed the Nifty 50 TRI in 1-, 3-, 5-, and 15-year CAGR returns, delivering 11.9%, 18.1%, 25.6%, and 13.9% respectively. Over longer tenures like 10 years, both indices performed similarly, highlighting the index’s consistency and potential for wealth creation.
The Nifty Top 15 Equal Weight index has shown resilience during major market downturns. In the taper tantrum, it fell -10.5% versus -12.6% for the Nifty 50. It even rose 2.4% during the Eurozone crisis, while the Nifty 50 gained just 0.3%. Its declines were also more contained during events like the Hindenburg episode and global tightening & Ukraine war. This defensiveness comes from equal weighting and a tilt towards stable, consumer-heavy sectors.
On the valuation front, the index appears moderately priced, with a P/E ratio of 21.4x vs. Nifty 50’s 22.3x. It also offers a slightly higher dividend yield of 1.42%, versus 1.25% for the Nifty 50.
Access and suitability
The Nifty Top 15 Equal Weight index is rebalanced quarterly and reconstituted semi-annually. This keeps it aligned with the top free-float large caps while preventing legacy bias. Its structure avoids thematic or mid-cap overreach.
Retail investors can gain exposure to this index through two formats. ETFs, which are traded like stocks, offer real-time prices and low costs. They require a demat account , ideal for SIPs and long-term investing, are mutual fund schemes that track the index without requiring a demat account. Both options carry no exit load and offer minimum investments.