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Sensex

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ASHLY ANSALAM

ASHLY ANSALAM (Querist)
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20 August 2013 Please anybody explain the concept and calculation of sensex.

CA Kintal Shah

CA Kintal Shah (Expert)
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15 September 2013 The BSE constantly reviews and modifies its composition to be sure it reflects current market conditions. The index is calculated based on a free float capitalisation method, a variation of the market capitalisation method. Instead of using a company's outstanding shares it uses its float, or shares that are readily available for trading. As per free float capitalisation methodology, the level of index at any point of time reflects the free float market value of 30 component stocks relative to a base period. The market capitalisation of a company is determined by multiplying the price of its stock by the number of shares issued by of corporate actions, replacement of scrips, etc.

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