NIFTY METAL

This index is designed explicitly for reflecting the behavior as well as the performance of the Metal sector, including mining. It also comprises of stocks that are being listed on the National Stock Exchange (or NSE). It also consists of a maximum of 15 stocks from the Metal sector that are being listed on the NSE or National Stock Exchange. Also, effective since September 28, 2015, the weights of each company in the index are being capped at 20%. During rebalancing of shares/change in index constituents/change in investable weight factors (IWFs), and the weightage of the index constituent (wherever applicable) is being capped at 20%. Also, the weightage of such stock can increase beyond 20% among the rebalancing periods.

Here's the Market Representation:

• This index mainly represents about 2.6% of the free-float market capitalization of the stocks that are listed on NSE and 87.9% of the free-float market capitalization of the stocks that form a part of the Metals universe as of March 31, 2016.
• Also, the total traded value for the previous 6 months ending March 2016 of all index components is about 4.5% of the traded value of entire stocks on NSE and 89.8% of the traded value of the stocks that form a part of the Metals universe.

Also, NIFTY Metal Index is being computed using the free-float market capitalization method, in which the level of the index completely reflects the total free-float market value of entire stocks in the index relative to a specific base market capitalization value. It can also be used for several purposes, such as the launching of index funds, benchmarking fund portfolios, and ETFs and structured products. The Eligibility Criteria for the Selection of Constituent Stocks:

• The companies must rank within the top 800 based on both average daily turnover as well as average regular full market capitalization for the last 6 months.
• The companies should also form a part of the Metals sector.
• Its trading frequency should be at least 90% in the previous 6 months.
• It should also have a listing history of 6 months, as a company that comes out with an IPO would be eligible for the inclusion in the index, only if it accomplishes the normal eligibility criteria for the index of 3 months instead of 6 months.
• Also, the final selection of 10 companies shall be made based on the free-float market capitalization.
• The weightage of every stock in the index is to be calculated based on its free-float market capitalization in such a way that no single stock should be more than 34%, and the weightage of the top 3 stocks should not be more than 63% during rebalancing.

Index Re-Balancing: It is done based on a semi-annual basis, and the cut-off date is January 31 as well as July 31 of each year, i.e., and for a semi-annual review of indices, average data for 6 months ending the cut-off date is considered. Also, 4 weeks before the notice is given to the market from the date of the change. Index Governance: Also, a professional team manages all NSE indices, and there is a three-tier governance structure, which comprises the Board of Directors of NSE Indices Limited, the Index Advisory Committee (Equity) and the Index Maintenance Sub-Committee.