NFO Alert: Tata Asset Management has introduced the Tata Nifty Midcap 150 Index Fund, a passive investment opportunity targeting mid-sized Indian companies poised for growth. The New Fund Offer (NFO) opens for subscription on June 2, 2025, and closes on June 16, 2025. Midcap Stocks Performance Despite recent market fluctuations, midcap stocks have shown resilience, often outperforming large-cap stocks over longer periods. The Nifty Midcap 150 TRI reported a 1-year rolling return of 21.89%, compared to 16.37% by the Nifty 50 TRI. Over a 3-year rolling period, midcaps returned 15.8%, surpassing large caps’ 12.38% return (Source: NSE, ICRA-MFI / Data from 1st Apr 2005 to 30th Apr 2025). Growth Potential of Midcaps “Midcaps represent India’s growth frontier. Through the Tata Nifty Midcap 150 Index Fund, investors can access sectors and companies vital to India’s economic expansion,” said Anand Vardarajan, Chief Business Officer, Tata Asset Management. “The fund is ideal for long-term investors seeking growth and diversification, with the discipline of passive investing.” Sector and Industry Exposure The Nifty Midcap 150 index encompasses companies from 20 sectors and 74 basic industries (Source: AMFI), including chemicals, oil, gas, consumable fuels, capital goods, automobiles, realty, financial services, and information technology. Notably, 39 industries in the midcap space, absent in the large cap space, account for over 40% of the index’s total weight, providing unique diversification benefits (Source: NSE | Data as on 30th Apr 2025). Wealth Creation Potential Over the past five years, 17 midcap companies have transitioned into large caps, demonstrating their potential for wealth creation. By tracking the Nifty Midcap 150 index through passive investment, investors can avoid stock-specific risks and benefit from a disciplined, cost-effective strategy. Historically, midcaps have outperformed large caps and small caps in systematic investment plans (SIPs), delivering an alpha of approximately 4% and 2% CAGR over the past 20 years respectively (Source: ICRA-MFI), making them a suitable choice for long-term investors.