DSP Mutual Fund Unveils Four Nifty Midcap and Smallcap Passive Schemes

DSP Mutual Fund today announced the launch of four new passive schemes - DSP Nifty Midcap 150 Index Fund, DSP Nifty Midcap 150 ETF, DSP Nifty Smallcap 250 Index Fund and DSP Nifty Smallcap 250 ETF*. These offerings strengthen DSP’s passive investing suite by providing rules-based, low-cost access to the mid- and small-cap segments, which together represent India’s broadest and most dynamic corporate universe.

The Nifty Midcap 150 Index comprises India’s 101st to 250th largest companies from Nifty 500, while the Nifty Smallcap 250 Index covers companies ranked 251 to 500 from Nifty 500. Historical data demonstrates that both indices have delivered meaningfully higher long-term returns compared to the broader market. Over a 10-year period, the Nifty Midcap 150 TRI has generated average rolling returns of 16.2%, far above the 12.6% delivered by the Nifty 500 TRI, according to an analysis of index behaviour as of October 31, 2025. The small-cap index has also rewarded investors over longer horizons, with the Nifty Smallcap 250 TRI delivering 13.5% average 10-year rolling returns, compared to 12.6% for the Nifty 500 TRI. Both the indices can have higher drawdown compared to broader market indices; however as holding period is lengthened, both indices improve probability of non-negative returns **

The two indices also offer exposure to sectors and industries where large-cap representation is limited. The Smallcap 250 has a pronounced presence in areas such as capital markets, industrial products, healthcare equipment, building materials, textiles and other niche segments. It also hosts several category leaders, underscoring the depth of emerging leadership beyond the top 250 companies. Meanwhile, the Midcap 150 provides more stable earnings profiles than the broad small-cap universe and contributes significant breadth during periods of broad-based market participation.

Both indices maintain low overlap with active fund categories, offering materially differentiated exposure. The Midcap 150 shares only 32% overlap with active midcap funds, while the Smallcap 250 has an even lower overlap of 18% with active smallcap fund’s portfolios. This structural differentiation can ensure that index-based investing can serve as a complementary and diversified building block alongside active strategies.

The New Fund Offers (NFOs) will be open from 24 November to 08 December 2025. 

“Midcaps and smallcaps sit at the intersection of innovation and growth in India. Our research shows that disciplined, rule-based exposure, instead of stock picking, has historically rewarded investors who stay invested through cycles. These products offer investors a simplified way to participate in broad-based market expansion,” said Anil Ghelani, CFA – Head – Passive Investments & Products at DSP Mutual Fund.