ALL ABOUT BSE SENSEX

The word ‘Sensex’ is derived from the words ‘sensitive’ and ‘index’. It refers to a free-float market where trading can be done in stocks and shares. There is a well-established index of thirty companies which are financially sound and are listed on the stock exchange in Bombay. Commonly known as bse index, this serves as the benchmark. It comprises the topmost companies which do business and trade in securities on this platform. The Sensex is considered the platform which shows the performance of different industrial sectors in the country. It is the oldest exchange and reflects the economic cycles as influenced by the development or decline in the industrial functioning of various enterprises. Let us look at some of the primary takeaways here:

1. Benchmark: It represents the top thirty well-performing companies in the country. These companies represent the primary sectors in our country and their performance influences the Sensex. The Bombay Stock Exchange is an index which changes as per the operations, political and social changes taking place in the country.
2. Launch: The stock exchange service was launched in 1986 to provide a stage for trading in commodities and stocks to earn. It is operated by Standard’s and Poor’s Analysts, which is used by operators and investors to analyze the various stocks and invest in different instruments accordingly.
3. Calculated in rupees: The value is calculated in Indian rupees and in U.S. Dollars. It is settled according to the float-adjusted by the companies. Market-capitalization is weighted based on the indices and the changes in the market due to the policy changes and the results of these companies.
4. Listing of the companies: The companies should be enlisted on the stock exchange. Most of these companies are mega-cap enterprises and large companies with turnover running into crores. The stocks up for listing should be relatively liquid and easily tradable. Another important criterion for listing is that the companies should be generating revenues from core activities to become eligible for listing on the exchange.
5. Balancing all sectors: It is important that the stock exchange represents all sectors and it is imperative to reflect the performance in a balanced manner. These sectors need to be kept in line with the equity market. The float of the companies is put up for trading so that the market can move based on the selling and buying of these stocks.

The bse index is a reference to assess the performance of the economy of the country. Various platforms like 5paisa provide options to open a Demat account trade on the exchange to earn profits from day-to-day variations in the market in addition to long-term investment options. They help customers and prospective investors put their savings to use and earn from the vagaries in the market. They also guide and help investors by helping them to open an account and informing them about the changes and suitable opportunities to invest and earn. It is important to understand the workings and limitations of the stock exchange to invest optimally and appropriately so that maximum returns can be earned on one’s investment.

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