methods or steps or procedure to caluclate sensex in bse?

calculation of nifty

2 Replies to “methods or steps or procedure to caluclate sensex in bse?”

1. Manoj says:

just calculate the 30 shares of BSE index in points like those stocks are in positive then add their point by they positive and subtract stock’s points those in negative example:
DLF at 630 20 points up
REL at 2300 45 points up
ITC at 210 8 points down
and so on….

then 20+45-8 = 57 point up in sensex
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2. Mallikarjuna Sastry says:

BSE Sensex is as an index calculated based on the free float capitalization technique. Free Float means the shares of a company that are traded in “Public entities”. All the entities (Retail Investors and Institutions) that are not Promoters of a company are called as Public Entities. To make things simple, lets take an example.

In the case of Wipro, around 80% + stake is held by Azim Premji (The Promoter of the company). And around 15% – 20% is traded on the exchange. So BSE considers the cumulative value of 15% shares of Wipro while calculating the Free float market capitalization of the company.

Free float Market Cap = # shares held by Public entities * Market Price of each share on the Exchange.

It calculates this for all the shares traded on BSE and takes the top 30 stocks by Free Float Market Capitaliztion. In the ideal case scenario this list is dynamic and may change even with in a day due to fluctuations in market price. Hence, BSE revises the list preiodically and until the next revision the components of the BSE 30 are fixed.

The total Free market cap for the 30 selected companies is added to get the total market cap of BSE 30 shares. Now weightages are assigned to each of the scrip based on the proportion of the BSE 30 market cap contributed by each share’s market cap. i.e.,

Say Market cap for Wipro is Rs 100 and the market cap for BSE 30 is Rs 1000. Now, weightage for Wipro is 0.1 (100/1000). There is a list of ranges for the free float market cap based on which the free float factor is compted for each scrip. These free flaot factors give us an idea of how much % of the market cap of a share is free float.

The BSE 30 index is nothing but a ratio of current market cap of BSE30 to a base year’s market cap (say 1980 etc…) As a result, you know how well / worse the market has performed irrespective of the absolute level of market caps. To have more information on this, you can actually visit the following page: