BASICS OF BSE
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BOMBAY STOCK EXCHANGE
Bombay stock exchange (BSE) is the oldest stock exchange in india & Asia also.BSE was originally established as “The Native Share and Stock Brokers Association in 1875.BSE obtained permanent recognition in 1956 from government of India under the Securities Contracts (Regulation) Act, 1956. BSE is the World Number 1 exchange in terms of the number of listed companies and the world’s 14th in transaction numbers. As on march, 2012 5,133 listed Indian companies & 8,196 scrips on the stock exchange.BSE introduced the world first centralized exchange –based internet trading system BSEWEBX.COM. This initiative enables investors anywhere in the world to trade on BSE.
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
BSE INDICES:BSE Offers 22 indices.
BSE SENSEX: it is indie’s first stock market index. it is a free float market capitalization-weighted index of 30 stocks representing well established and financially sound companies. The index calculation frequency is every 15 seconds. There is proper guidelines for selection of scrip on BSE sensex.30 companies as on 30/05/2012 on BSE Sensex as follow: ITC,RIL,HDFC,INFOSYS,L&T,ICICI,ONGC,TCS,SBI,HUL,TATA MOTORS,AIRTEL,M&M,TATA STEEL,BAJAJ AUTO,SUN PHARMA,COAL INDIA,WIPRO,NTPC,HERO HONDA,JINDAL STEEL,GAIL INDIA,BHEL,CIPLA,MARUTI SUZUKI,TATA POWER,HINDALCO,STERLITE INDUS,DLF,HDFC BANK.
Closing prices of Sensex are calculated by using a specific formula.
SENSEX - Scrip Selection Criteria
1. Equities of companies listed on Bombay Stock Exchange Ltd. (excluding companies classified in Z group, listed mutual funds, scrips suspended on the last day of the month prior to review date, scrips objected by the Surveillance department of the Exchange and those that are traded under permitted category) shall be considered eligible
2. Listing History: The scrip should have a listing history of at least three months at BSE. An exception may be granted to one month, if the average free-float market capitalization of a newly listed company ranks in the top 10 of all companies listed at BSE. In the event that a company is listed on account of a merger / demerger / amalgamation, a minimum listing history is not required.
3. The scrip should have been traded on each and every trading day in the last three months at BSE. Exceptions can be made for extreme reasons like scrip suspension etc.
4. Companies that have reported revenue in the latest four quarters from its core activity are considered eligible.
5. From the list of constituents selected through Steps 1-4, the top 75 companies based on free-float market capitalisation (avg. 3 months) are selected as well as any additional companies that are in the top 75 based on full market capitalization (avg. 3 months).
6. The filtered list of constituents selected through Step 5 (which can be greater than 75 companies) is then ranked on absolute turnover (avg. 3 months).
7. Any company in the filtered, sorted list created in Step 6 that has Cumulative Turnover of >98%, are excluded, so long as the remaining list has more than 30 scrips.
8. The filtered list calculated in Step 7 is then sorted by free float market capitalization. Any company having a weight within this filtered constituent list of <0.50% shall be excluded
9. All remaining companies will be sorted on sector and sub-sorted in the descending order of rank on free-float market capitalization.
10. Industry/Sector Representation: Scrip selection will generally attempt to maintain index sectoral weights that are broadly in-line with the overall market.
11. Track Record: In the opinion of the BSE Index Committee, all companies included within the SENSEX should have an acceptable track record.
Some other BSE equity market Indices:
BSE 100, BSE 200, BSE 500
BSE Sectoral indices:
BSE IT SECTOR, BSE FMCG, BSE BANKING, BSE PSU, BSE HEALTH CARE, BSE CONSUMER DURABLES.
BOMBAY STOCK EXCHANGE
Bombay stock exchange (BSE) is the oldest stock exchange in india & Asia also.BSE was originally established as “The Native Share and Stock Brokers Association in 1875.BSE obtained permanent recognition in 1956 from government of India under the Securities Contracts (Regulation) Act, 1956. BSE is the World Number 1 exchange in terms of the number of listed companies and the world’s 14th in transaction numbers. As on march, 2012 5,133 listed Indian companies & 8,196 scrips on the stock exchange.BSE introduced the world first centralized exchange –based internet trading system BSEWEBX.COM. This initiative enables investors anywhere in the world to trade on BSE.
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
BSE INDICES:BSE Offers 22 indices.
BSE SENSEX: it is indie’s first stock market index. it is a free float market capitalization-weighted index of 30 stocks representing well established and financially sound companies. The index calculation frequency is every 15 seconds. There is proper guidelines for selection of scrip on BSE sensex.30 companies as on 30/05/2012 on BSE Sensex as follow: ITC,RIL,HDFC,INFOSYS,L&T,ICICI,ONGC,TCS,SBI,HUL,TATA MOTORS,AIRTEL,M&M,TATA STEEL,BAJAJ AUTO,SUN PHARMA,COAL INDIA,WIPRO,NTPC,HERO HONDA,JINDAL STEEL,GAIL INDIA,BHEL,CIPLA,MARUTI SUZUKI,TATA POWER,HINDALCO,STERLITE INDUS,DLF,HDFC BANK.
Closing prices of Sensex are calculated by using a specific formula.
SENSEX - Scrip Selection Criteria
1. Equities of companies listed on Bombay Stock Exchange Ltd. (excluding companies classified in Z group, listed mutual funds, scrips suspended on the last day of the month prior to review date, scrips objected by the Surveillance department of the Exchange and those that are traded under permitted category) shall be considered eligible
2. Listing History: The scrip should have a listing history of at least three months at BSE. An exception may be granted to one month, if the average free-float market capitalization of a newly listed company ranks in the top 10 of all companies listed at BSE. In the event that a company is listed on account of a merger / demerger / amalgamation, a minimum listing history is not required.
3. The scrip should have been traded on each and every trading day in the last three months at BSE. Exceptions can be made for extreme reasons like scrip suspension etc.
4. Companies that have reported revenue in the latest four quarters from its core activity are considered eligible.
5. From the list of constituents selected through Steps 1-4, the top 75 companies based on free-float market capitalisation (avg. 3 months) are selected as well as any additional companies that are in the top 75 based on full market capitalization (avg. 3 months).
6. The filtered list of constituents selected through Step 5 (which can be greater than 75 companies) is then ranked on absolute turnover (avg. 3 months).
7. Any company in the filtered, sorted list created in Step 6 that has Cumulative Turnover of >98%, are excluded, so long as the remaining list has more than 30 scrips.
8. The filtered list calculated in Step 7 is then sorted by free float market capitalization. Any company having a weight within this filtered constituent list of <0.50% shall be excluded
9. All remaining companies will be sorted on sector and sub-sorted in the descending order of rank on free-float market capitalization.
10. Industry/Sector Representation: Scrip selection will generally attempt to maintain index sectoral weights that are broadly in-line with the overall market.
11. Track Record: In the opinion of the BSE Index Committee, all companies included within the SENSEX should have an acceptable track record.
Some other BSE equity market Indices:
BSE 100, BSE 200, BSE 500
BSE Sectoral indices:
BSE IT SECTOR, BSE FMCG, BSE BANKING, BSE PSU, BSE HEALTH CARE, BSE CONSUMER DURABLES.
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