Nifty Next 50 futures on Zerodha

Nifty Next 50 futures are futures contracts on the Nifty Next 50 index, listed on the National Stock Exchange (NSE) and traded in India through brokers including Zerodha . The underlying index covers the 50 companies ranked 51 to 100 by free-float market capitalisation, the Nifty 100 after the Nifty 50 is removed, and is maintained by NSE Indices Limited. One contract settles in cash against the index close and expires on the last Tuesday of its month under the schedule SEBI set from September 2025. The defining feature for a trader is liquidity: Nifty Next 50 futures trade far thinner than Nifty 50 futures .

This article sets out the index composition, the futures lot size, the Tuesday expiry, cash settlement, and the liquidity caveats that matter most when trading this contract: wider spreads, lower open interest and the price impact of large orders. It links to the F&O segment on Zerodha , the margin articles, and the Nifty Next 50 index fund for readers whose goal is long-term exposure rather than a leveraged or hedged derivative position.

What the Nifty Next 50 tracks

The Nifty Next 50 index represents the 50 companies ranked 51 to 100 by free-float market capitalisation within the Nifty 100 index . Put another way, it is the Nifty 100 after the 50 Nifty 50 constituents are excluded, so it captures the large companies just below the headline index. It is computed on a free-float market-capitalisation weighted basis and reconstituted half-yearly in March and September, in line with the other NSE Indices benchmarks.

The index is often described as the pool from which future Nifty 50 entrants are drawn, since a company that grows large enough is promoted from the Next 50 into the Nifty 50 at a reconstitution. Its constituents include large companies across consumption, financials, industrials and other sectors. Because it sits just below the most heavily traded large caps, its futures attract less interest than the Nifty 50 contract, which is the source of its liquidity caveat. The current constituents are published in the NSE Indices factsheet for the index, updated after each rebalancing.

Futures contract specifications

The contract specification fixes the lot, the settlement basis and the expiry.

NSE fixes the Nifty Next 50 futures lot so the contract value sits in the Rs 15 lakh to Rs 20 lakh band that the October 2024 index-derivatives framework requires. The January 2026 lot-size revision that reduced the lots for Nifty 50 (to 65), Bank Nifty (to 30), FinNifty (to 60) and Nifty Midcap Select (to 120) left the Nifty Next 50 lot unchanged, because its index level and the existing lot already placed the contract value in band. A trader should read the current lot from the Kite order window, since it is the live figure for the contract month selected.

Expiry and the September 2025 change

Nifty Next 50 futures expire on the last Tuesday of the expiry month. SEBI standardised NSE derivatives expiries to Tuesday from 1 September 2025, moving them off the historical Thursday and assigning BSE contracts Thursday so the exchanges no longer cluster expiries. If the last Tuesday is a trading holiday, expiry shifts to the previous trading day. The mechanics of the calendar are set out in how the options expiry calendar works .

The Nifty Next 50 has never carried a weekly options expiry. The November 2024 framework that discontinued the weekly options on FinNifty, Bank Nifty and Nifty Midcap Select did not affect Nifty Next 50, which had only monthly contracts to begin with.

Cash settlement

Nifty Next 50 futures are cash settled against the closing value of the index on expiry day, computed by NSE Indices Limited. No shares change hands. The settlement converts the difference between the trader’s entry and the index close into a cash credit or debit, scaled by the lot size. There is no delivery obligation, which distinguishes it from single-stock futures, detailed in physical settlement of stock F&O .

Liquidity caveats

Liquidity is the consideration that separates Nifty Next 50 futures from the Nifty 50 futures contract. The Nifty 50 futures are among the most heavily traded contracts on NSE; the Nifty Next 50 futures are not.

Three consequences follow for a trader:

• Wider bid-ask spreads. With fewer participants quoting, the gap between the best bid and the best offer is larger than for Nifty 50 futures. Crossing the spread on entry and again on exit is a real cost, and on a thin contract it can exceed the brokerage.
• Lower open interest and volume. Fewer contracts are open and fewer trade each day, so a position can be harder to enter or exit at a fair price, and harder to size up without moving the market.
• Price impact of large orders. A large order can move the Nifty Next 50 futures price against the trader because the order book is thin. This is the slippage that a thin contract imposes, and it is worst near expiry when liquidity concentrates in the near-month and the next-month is almost untraded.

A trader should check the spread and the depth in the Kite order window before placing a Nifty Next 50 futures order, and use a limit order rather than a market order to avoid paying an unfavourable price into a thin book. The liquidity caveat also raises the risk profile of the contract: a position that cannot be exited quickly compounds the gap and margin risks set out in the risks of F&O trading on Zerodha .

Margin and the index-fund alternative

Holding one Nifty Next 50 futures lot requires SPAN margin plus exposure margin , with the total at a low double-digit percentage of the contract value, shown live by the Zerodha margin calculator . Intraday traders use the MIS product code ; positional traders use NRML .

For a reader whose aim is long-term exposure to the Nifty Next 50, the futures are the wrong instrument. A Nifty Next 50 index fund gives the same index exposure without leverage, without a margin requirement, without monthly expiry and rollover, and without the liquidity caveat that the futures carry. The futures suit a short-term leveraged or hedged position by a trader who has weighed the thin liquidity; the index fund suits an investor who wants the index held for years. The two are not substitutes, and the choice turns on horizon and purpose, not on which looks cheaper per unit of exposure. A Nifty Next 50 ETF is a third route for exposure that trades on the exchange without the derivative’s rollover and margin.

See also

• F&O segment on Zerodha
• Nifty Next 50 index fund
• How to invest in a Nifty Next 50 ETF
• Nifty 100 index fund
• Nifty 50
• National Stock Exchange
• Nifty futures contract specifications
• FinNifty futures on Zerodha
• Midcap Nifty futures on Zerodha
• Stock futures lot size on NSE
• Weekly expiry contraction, November 2024
• How the options expiry calendar works
• SPAN margin on Zerodha
• Exposure margin on Zerodha
• Zerodha margin calculator
• NRML product code
• MIS product code
• Kite (Zerodha)
• Physical settlement of stock F&O
• Risks of F&O trading on Zerodha
• How to rollover an F&O position on Zerodha
• Open interest
• SEBI F&O entry-barrier rules 2024
• Nifty 50 ETF

External references

• NSE Indices: Nifty Next 50 index
• NSE: Equity derivatives contract specifications
• SEBI: Measures to strengthen the index derivatives framework
• Z-Connect: SEBI’s new rules for index derivatives
• Zerodha margin calculator

References

1. NSE Indices Limited, Nifty Next 50 index methodology and factsheet (companies ranked 51 to 100 of the Nifty 100).
2. NSE, Equity derivatives contract specifications, Nifty Next 50 futures.
3. SEBI, measures to strengthen the index derivatives framework, circular dated 1 October 2024 (Rs 15 lakh to Rs 20 lakh contract-value band).
4. NSE circular, revised lot sizes for index derivatives effective from the January 2026 cycle (Nifty Next 50 lot unchanged).
5. SEBI, final settlement day standardised to Tuesday for NSE derivatives, effective 1 September 2025.