What is Index? What is Nifty & Sensex in Indian Stock Market Role of Nifty & Sensex - 2

 What is Index?

Guys, do you remember when you had heard word index before. I'll tell you; when you were in college or school that time in book, we've seen it. Everybody knows what is its use, it shown us a directory or we can say that it shown us a path like which topic is on which page. Similarly can you guess why I gave that example? Yes you are right, there are many companies listed in stock market. To see market views, direction it is used. In stock market Index tells us about market view & Market Direction. In Nifty, it represents the weighted average of 50 Indian company stocks in 12 sectors. 

• Energy 
• Materials
• Industrials 
• Consumer Discretionary
• Financials 
• Information Technology
• Telecommunication Services
• Utilities 
• Real Estate

Most of the times we seen on news channels that nifty raised for 200 points, Sensex decreased for 100 points; this means we are observing index.

There are two index in India:

1. Sensex

2. Nifty

Sensex is for BSE and its full form is Sensitive Index. Nifty is for NSE and its full form is National Fifty. Now we'll see from what index are made? what is its procedure? What is it's benefit?

Sensex:

• Full form of Sensex "Sensitive Index"
• It represents the weighted average of 30 Indian company's stock in different sectors.
• it is one of the two main stock indices in India.
• Base value - 

I can understand which question is stabbing your mind: It represents the weighted average of 30 Indian company's stock in different sectors. What is that actually. We'll not waste our time here. Top 30 companies from Indian stock markets are taken and by using their index Sensex index is measured. If a company among them made less profit then it will be thrown out of that group and another company which made better profit and whose market capitalization is more than that company then these two companies will be swapped.

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What is Nifty?

• Full form of NIFTY  is National Stock Exchange Fifty.
• It represents the weighted average of 50 Indian company's stock in 12 sectors.
• it is one of the two main stock indices used in India
• Base Value - 1000

Concept is same as Sensex. 

If there are any errors, bad information, misleading information then please let me know in comment section. I'll definitely correct it.