Nifty Total Market ETF vs Nifty Next 50 ETF: Diversification or Focused Mid-Cap Exposure?

Exchange-Traded Funds (ETFs) have gained significant popularity among Indian investors, with assets under management (AUM) surpassing ₹5 lakh crore as of 2024.

The growing adoption of ETFs is driven by their liquidity, transparency, and lower expense ratios compared to actively managed mutual funds.

While most ETFs traditionally track the Nifty 50 or Sensex, providing exposure to large-cap stocks, a broader alternative has emerged—the Nifty Total Market ETF. This ETF offers diversification across 750 stocks, spanning large, mid, small, and micro-cap segments.

In contrast, the Nifty Next 50 ETF focuses on the next 50 largest companies after the Nifty 50, giving investors exposure to mid-cap and emerging large-cap stocks.

Let’s compare how the Nifty Total Market ETF stacks up against the widely followed Nifty Next 50 index in terms of diversification and exposure.

Nifty Total Market Index vs Nifty Next 50: Stock Composition, Market Cap Exposure

Note: The data is as of January 31, 2025.

Nifty Total Market ETF provides exposure to 750 stocks, making it ideal for long-term diversification and stability. Meanwhile, the Nifty Next 50 ETF is concentrated on mid-caps, offering higher growth potential but with greater volatility.

Nifty Total Market Index vs Nifty Next 50: Performance and Volatility

Note: The data is as of January 31, 2025.

Nifty Next 50 ETF has delivered higher returns but comes with higher volatility (20.02% vs. 18.68%). Meanwhile, Nifty Total Market ETF offers smoother performance due to diversification across sectors and market caps.

Which ETF Should You Choose?

How To Get Exposure to The Nifty Total Market Index through ETF?

Investors can gain exposure to the Nifty Total Market Index through mutual funds and ETFs. For those looking to invest via ETFs, Angel One MF has launched two new funds that consider Nifty Total Market TRI to be the benchmark.

The Angel One Nifty Total Market ETF is currently the only ETF providing exposure to the Nifty Total Market Index.

How To Get Exposure to The Nifty Next 50 Index through ETF?

There are several options for investing in the Nifty Next 50 Index Fund, including ICICI Prudential Nifty Next 50 ETF, Mirae Nifty Next 50 ETF and more.

Conclusion

The Nifty Total Market ETF offers broad diversification, while the Nifty Next 50 ETF provides focused mid-cap exposure with higher growth potential. Investors should choose based on their risk appetite and investment goals.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.