Are you one of those who dive down the “Share market today” section searching for familiar logos every morning? If so, you must have come across the word ‘SENSEX’, which occupies headlines and quotes of websites almost every day. Have you ever wondered why the ups and down in SENSEC are always on the first lines of the Indian share market (it isBazar or Bajar)?
Suppose you want to know about it or consider investing in the Indian share market. In that case, it’s important to understand how SENSEX is calculated, its value, and how it can affect your investment portfolio. In the article, you will find all the information about the SENSEX index. We’ll cover its composition, how the trading system calculates its position, and discuss some factors influencing its performance.
What is SENSEX?
SENSEX, or the Bombay Stock Exchange (BSE) index, is the most widely tracked equity gauge in India. The SENSEX full form is made of two words Sensitivity and Index.
Note! BSE was founded in 1875 in Bombay (now Mumbai), making it the first stock exchange in India’s history and the oldest in Asia. Most importantly, it is the Fastest Stock Exchange in the world.
The SENSEX is India’s primary stock market index. It measures the performance of stocks listed on the Bombay Stock Exchange and is a crucial indicator of the overall health of India’s economy. The S&P BSE SENSEX is a free-float stock market index composed of 30 financially sound and well-established Indian companies. It is weighted according to their market capitalization. These thirty companies represent various industrial sectors of the Indian economy. Their shares are among the most valuable and widely traded in the stock market.
In short, SENEX keeps track of the current price movements of these biggest listed companies in India.
Note! It’s not a secret that securities have important news. Thus, Sensex surged more than 600 points on February 1 ahead of the Union’s budget presentation for 2022-2023 in Parliament (Bhāratīya Sansad).
SENSEX 30 Companies
SENSEX is a stock market index of 30 companies listed on the Bombay SE. The inclusion of companies in the BSE index is based on several criteria: liquidity, mega-cap or size, healthy balance sheet, solid revenue margins, and significant market share in the industry in which they operate.
These 30 SENSEX companies receive cash, convert it to stock and sell it the next day. A person who owns stock in a company is called a shareholder. The share price of these companies keeps on going up and down. Meanwhile, online trading today in India keeps growing at a rate of knots, so it will be best to remember about financial risks. Decisions should be made accurately to avoid the loosing of funds.
According to the last news, the list of SENSEX companies with different market values today is as follows:
- ASIAN PAINTS
- AXIS BANK
- BAJAJ FINANCE
- BAJAJ FINSERV
- BHARTI AIRTEL
- DR. REDDY’S LAB
- HCL TECHNOLOGIES
- HDFC BANK
- ICICI BANK
- INDUSIND BANK
- ITC Limited
- KOTAK MAHINDRA BANK
- MARUTI SUZUKI
- POWER GRID
- RELIANCE IND.
- SUN PHARMA
- TATA STEEL
- TECH MAHINDRA
- ULTRATECH CEMENT
Note! This latest SENSEX list is current as of April 2022.
How is SENSEX calculated?
SENSEX is calculated using a free-float capitalization method. Companies’ shares are measured against the total market capitalization of all stocks in India, instead of just those who make up their benchmarks as other markets do, giving them more weighting than smaller firms would have otherwise.
SANSEX is a popular index that considers the most significant companies within its circuit. However, unlike other methods, it only weighs shares freely available for trade instead of those held by insiders or restricted classes of ownership like REITs (Real Estate Investment trusts).
For instance, suppose a company has 100 shares, of which the promoters or the government holds 30, and the rest of the 70 are available to the general public for trading. Those 70 shares are considered free-floating shares, and the free floater factor is 70%. Market capitalization is determined by multiplying the stock price with the number of shares furnished by that company.
Here are the steps on how SENCEX is calculated:
- The Market Capitalizations of all 30 companies will be determined.
- The Free Float Market Capitalization of all the thirty companies is determined.
- The Free Float Market Capitalization of all the 30 companies is summed to get the total free float capitalization.
- The formula to calculate SENSEX = (Total free-float market capitalization/ Base market capitalization) * Base index value.
To calculate the value of SENSEX, we use 1978-79 as our base year. The index is 100, so it’s easy to see how much money has changed hands.
How to Invest in SENSEX?
As you can see, the SENSEX is made up of India’s best firms. Did you buy the shares? Well, you become a part-owner of these incredible businesses. You can now invest in SENSEX in one of two ways.
- Invest in stocks directly in the same proportion as the SNSEX’s weightage
You can start investing directly in SENSAX components and their weight in this index. It means that you can purchase shares according to their weight.
- Invest in Index Mutual Funds
Investing in index mutual funds is an excellent way to invest in SENSEX. These funds are index replicas, meaning they have a portfolio identical to the index. As a result, the SENSEX index fund will have 30 stocks in a comparable proportion to the SENSEX.
What do the SENSEX movements mean?
If SENSEX rises, the stock prices of most of the large businesses listed on the BSE will increase. If SENSEX falls, the stock prices of most of the significant stocks listed on the BSE have fallen as well.
Note! If you want more information about the SENSEX stock market, you can view Wikipedia or Wiki answers, Google Finance or www.yahoo.com.
What is SENSEX today?
As we said, you can check the live SENSEX trends on Google Finance. It shows everything, including the live charts, SENSEX timings, whether the stock price is up or down, real-time trading, and every kind of share status. Besides, if you want to see yesterday’s and tomorrow’s forecast of the value of SENSEX, you can check online.
To know more details about how the SENSEX performs, you can see the BSE live chart with graphs along with proper symbols, tickers, and pointers. It shows the proper analysis of the SENSEX trends and how many points it has gone up or down. Also, it shows the closing price of the stock exchange.
SENSEX news today
You can identify the booms and busts of the Indian equity market through BSE SENSEX. The SENSEX news is available in Hindi and English. Today, you can get live updates about S&P BSE SENSEX online on the Indian share market and stock exchange.
Get the current SENSEX share price, reports, and today’s live index on various platforms. There are also various apps that report “BSE SENSEX today” and are updated in real-time.
The Indian stock market is increasing and has a lot of potential for investors. Before investing in the stock market, it’s essential to understand how it works and what are the risks involved.
If you want to invest in the Indian stock market, you must understand what BSE/NSE is and all the details. Particular attention should be paid to SENSEX, how it is calculated and when to invest. Also, be sure to weigh your investment options and risks before making any decisions. Start investing and trading in the stock market with SENSEX right now!