Dear members,
Plz read the below article that explains you regarding how to calculate index (nifty & Sens*x)
Stock is the smallest unit of ownership of a company in other words stock is a share in the ownership of the company. Stock is also called as share and equity. If a person purchases stocks of a company it means that he is one of the owners of the company, and ownership increases as he goes on purchasing more amount of stocks. Technically speaking a shareholder of a company owns a small part of every assets of the company such as building, furniture, trademarks, etc. A share holder holds ownership in all tangible and intangible assets of the company.
- Listing history: The Company should have listing history on BSE for at least one year
- Track record: company should have good track record.
- Market capitalization: Company should be one among 100 market capitalizations of BSE, and each company should have more than 0.5% of total market capitalization of BSE index.
- Frequency of trading: company stocks should be traded on each and every trading day for the last one year.
- Industrial representation: company should be a leader in the industry it represents.
- Government holding shares as promoters
- Holdings by Directors/ Founders
- Holdings through the FDI route
- Stakes held by private corporate bodies or individuals.
- Any cross holdings i.e. equity held by associate or group companies.
- Equity held by employee welfare trust.
Free float factor = No of shares available for trading in the open market / Total No of outstanding shares of the company.
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% Free-Float
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Free-Float Factor
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% Free-Float
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Free-Float Factor
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>0 – 5%
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0.05
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>50 – 55%
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0.55
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>5 – 10%
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0.1
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>55 – 60%
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0.6
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>10 – 15%
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0.15
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>60 – 65%
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0.65
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>15 – 20%
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0.2
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>65 – 70%
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0.7
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>20 – 25%
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0.25
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>70 – 75%
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0.75
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>25 – 30%
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0.3
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>75 – 80%
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0.8
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>30 – 35%
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0.35
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>80 – 85%
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0.85
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>35 – 40%
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0.4
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>85 – 90%
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0.9
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>40 – 45%
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0.45
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>90 – 95%
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0.95
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>45 – 50%
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0.5
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>95 – 100%
|
1
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SENSEX = (sum of free float market cap of 30 major companies of BSE) X Index value in 1978-79 / Market cap value in 1978-79.
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Stock
|
Issued Stocks
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Market price
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Market Cap.
|
X
|
1000
|
100
|
100000
|
Y
|
2000
|
50
|
100000
|
Stock
|
Open Market Stocks
|
Market price
|
Market Cap.
|
X
|
500
|
100
|
50000
|
Y
|
1000
|
50
|
50000
|
- Base year is 1995 and base value (index value) is 1000
- Nifty represents stocks of 50 major companies of NSE.
NIFTY = (Sum of free flow market cap of 50 major stocks of NSE) X Index value in 1995 / market cap value in 1995.
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hope this article will be helpful for u all.
best regards,
ratan