Expanding the benchmarking framework for listed Real Estate Investment Trusts and Infrastructure Investment Trusts in India, NSE Indices Limited has launched the Nifty REITs & InvITs 90:10 Index. This index is designed to track the performance of publicly listed REITs and InvITs and is expected to serve as a reference point for asset managers running active funds.
Highlights
- NSE Indices Limited launched a new thematic index to track REITs and InvITs with a base date of April 1, 2021, and a base value of 1000.
- The maximum weight for each security in the index is set at 33%, the total weight of the top three constituents is capped at 62%, and the combined minimum weight of all REITs is maintained at 90%.
- The index will be reconstituted and rebalanced in the March, June, September, and December quarters, providing asset managers with a new benchmark for active funds.
This article was translated from the original. Read the original version by our correspondent here.
Index Structure and Rebalancing
According to NSE India, as per NSE Indices Limited, the new thematic index tracks the performance of listed REITs and InvITs, with each security's weight determined by its free-float market capitalization, subject to a 33% cap.The combined minimum weight of all REITs in the index is set at 90%, while the total weight of the top three constituents is limited to 62%. The index base date is April 1, 2021, and the base value is set at 1000. The index will be reconstituted and rebalanced quarterly in March, June, September, and December.
Significance for Asset Managers and the Market
This new index is expected to become a benchmark for active funds managed by asset managers, enabling a more systematic measurement of the performance of listed income-generating real estate and infrastructure assets.This initiative is likely to increase the visibility of the REITs and InvITs segment in the Indian capital market, especially among investors and fund managers seeking comparative performance standards for income-focused and alternative listed assets.
Our previous report discussed changes in the methodology of the Nifty REITs & Realty Index, which mentioned implementing a 32% cap on the combined weight of constituents related to the same sponsor, promoter group, or corporate group from July 24, 2026. We noted that the purpose of this weight capping is to reduce concentration risk in the index, and investors and funds tracking it may need to adjust their portfolio allocations accordingly.
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