Birth of a new index

Summary: Launched in May 2025, this media and gaming-heavy index may sound exciting. However, its back-tested history reveals underwhelming performance, high volatility and structural risks. The market is awash with indices, but riding in on fresh tides is the Nifty Waves Index, launched in May 2025. Let’s dive in to see what this uniquely named index is all about. What is Nifty Waves Index? This index, launched this May, follows companies from India’s media, entertainment and gaming sectors. Each stock’s weight is decided by its free-float market cap, but no stock can have more than 5 per cent weight. Composition As of July 31, 2025, the index comprises 43 stocks. But this number isn’t fixed, as stocks can enter and exit every three months when the index is reviewed. The index is full of small companies. The average company size is Rs

This article was originally published on September 20, 2025.