What is Sensex
SENSEX which is made up of Sensitive Sens and Index Ex, is a Sensitive Index indexing the Indian capital market. The Sensex indexes the Bombay Stock Exchange (BSE), hence it is also called BSE-Sensex. The Sensex is calculated on the basis of the Free-float Market Capitalization Method.
Sensex is acting as an indicator for the Mumbai Stock Market till date since it was first published on January 1, 1986.
The is base year of the Sensex in stock market is 1978-1979, and its is base value of 100 for that’s time. Calculate from cap and base value. You will read about it below.
At that time the Sensex was started at 100 Points so that it is easy to calculate. Because on the next day if the stock market trading increased by 10 percent, then Sensex’s points would also have increased by 10 percent to 110 points. Indicates. When the share holders sell the shares of that company, as a result of which the prices of the shares of that company fall, causing a downturn in the stock market. It is also known by the name that there are more than 5500 companies registered in it.
But Sensex does not index all these 5500 companies.
The most active of these registered companies in BSE-Sensex, Market Cap According to the largest, financially very strong and having a very good hold in the Indian market, only the top 30 companies are taken, which are different. The following comes from the main industrial sectors. These companies represent the various industrial sectors of the Indian economy in a way. These companies are called “blue-chip” companies. This list of thirty companies varies according to the market cap of the companies in the stock market.
How does Sensex work?
The work of Stock Market Index takes information about the prices of all the shares listed in the stock market and shows an average value so that people get to know about the rise and fall in the prices of all the shares of the stock market. Stay tuned.
From Sensex, we get to know how the company whose shares are listed in BSE is working, if the company does a good job then the share market also increases, and if the company If the profit is decreasing or the company does not do well, then there is a recession in the share market too.
Benefits of Sensex
Some of the major benefits of Sensex are being told below –
If Sensex increases, then the company benefits, and when the company benefits, then the number of people who buy shares It also increases due to which the price of the company’s shares or stock also high or increases, due to which the many company develops of them. There is a good effect on Indian currency, and Indian currency can be stronger than foreign currency. Gets it. Whenever the market is affected due to any political, social, economic etc., then the company either gains or has to suffer. On profit, the company’s shares increase, due to which the Sensex rises (Bullesh) and on loss, the company’s shares fall, due to which the Sensex decreases i.e. Bearish comes.
Measurement of Sensex
As you now know the volatility in the shares of large companies registered under Sensex is measured. Obviously this will not be a small calculation. A special method is adopted to measure it, which is called ‘Free Float Market Capitalization’. In this way the Sensex is measured by the Free Float Market Capitalization method.
Importance of Sensex
The stock market is very important for the economy of any country. It maintains the required money flow in the market. In other words, the stock market has a very important contribution in maintaining the liquidity of the market and the economy.
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