Index in share market.
Index consists of group of shares. Index denotes the direction of the entire market. Like when people say market is going up or down then that means Index is going up or down. Index consists of high market capitalization and high liquidity shares.
High Market capitalization shares – Companies having highest number of shares and highest price of each share.
Market capitalization is calculated by multiplying current share price and number of shares in the market.
High Liquidity shares – Shares in the market with high volumes.
Two types of Indices: Nifty and Sensex
Nifty – Nifty consist of a group of 50 shares.
Sensex – Sensex consist of a group of 30 shares.
Mainly there are two exchanges in India.
NSE (National stock exchange) – Nifty is listed with NSE.
BSE (Bombay stock exchange) – Sensex is listed with BSE.
NSE and BSE are countries economic barometer.
Stock exchanges like NSE and BSE are the places where the trading of shares takes place.