The National Stock Exchange of India Limited (NSE) was incorporated as a joint stock company under the Companies Act, 1956 on November 27, 1992.The Government of India has granted recognition as a stock exchange under the Securities Contracts (Regulation) Act, 1956 with effect from April 26, 1993. NSE is the first demutualized stock exchange in the country. It is the 11th largest stock exchanges in the world by market capitalization.
INDICES:
Indices (Index) are used to reflect the overall movement (up & down) of stock prices. Index is a number used to represent the change in a set of value between a base time period and another time period. Every stock Price move for two possible reasons:
1. News about the company e.g. new invention, New Product launch etc.
2. News about the Country e.g. Budget of Country, Politics Changes etc
INDICES ON NSE:
Standard & Poor(S & P) CNX Nifty: it is well diversified 50 stock index accounting for 23 sectors of the economy .The total traded value of all Nifty stocks is approximately 70% of the traded value of all stocks on the NSE. Nifty stocks represent about 59% of the total market capitalization.
S & P Nifty Junior: This index consists of 100 most liquid stocks in India, which are not forming part of S & P CNX Nifty. The maintenance of the S & P CNX Nifty and the CNX Junior are synchronized that the two indexes will always be disjoint sets i.e. a stock will never appear in both indexes at the same time.CNX Nifty junior represents about 6% of the total market capitalization.
S & P CNX 500: The S & P CNX 500 IS The India‘s first broad benchmark. It represents about, 94% of total market capitalization and about 98% of the turnover on the NSE. The companies in the index are disaggregated into 74 industry indexes. Industry weight ages in the market reflect the industry weight ages in the market. For example if the banking sector has a 5% weight age in the universe of the stocks traded on NSE, banking stocks in the index would also have an approximate representation of 5% in the index.
CNX MIDCAP 200: The index consists of midcap segment of the market and it represents about 68% of the total market capitalization and about 72% of the total traded value.
CNX IT SECTOR INDEX: The index consists of companies which are having more than 50% of their turnover from IT related activities like software development, hardware manufacturers support and maintenance
CNX FMCG INDEX: The index consists of stocks It represents over 90% of market capitalization and turnover of FMCG stocks.
CNX MILLENNIUM INDEX: It comprises of companies belonging to the high-tech, hi-growth sectors like IT, Telecom, Media, Internet etc.
CNX PSE INDEX: it comprises of 20 public sector enterprise stocks.
CNX MNC INDEX: it consist of 50 listed companies in which the foreign shareholding is over 50% and/or the management control is vested in the foreign company.
Objectives:
1. Establishing nationwide trading facilities for all types of securities.
2. Ensuring equal access to investors all-over the country through an appropriate communication network.
3. Enabling shorter settlement cycles and book entry settlements.
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