what is stock market?

 

what is stock market? 

   Stock market is a market place where we can buy or sell stock, security and bonds. We will discuss in depth about stock market and its various types.

 Here we are going to discuss about India’s two largest stock exchange called nifty and Sensex. BSE Bombay stock exchange is biggest stocks Exchange in India. NSE also a leading stock exchange which come with new technology and innovation in financial market of India. To understand what is nifty and Sensex you first need to understand the Indian stock exchanges let's discuss the two major stock exchanges in India the Bombay Stock Exchange and the National Stock Exchange along with their indexes Bombay Stock Exchange BSE and national stock exchange NSE. Bombay stock exchange is the Indian Stock Exchange located in the Dalal Street Mumbai Maharashtra. It was stabilized in 1875 and this is an oldest Stock Exchange of India. The BSE is the world's 7th largest Stock Exchange with an overall market capitalization of dollar 2.8 trillion as of Feb 2021. More than 5000 companies are publicly listed on BSE.  BSE and NSE both are major index of India. Let’s know about index.

What is market index?

     The market index is the barometer of the market behavior it gives a general idea about whether the most of the stocks has gone up or gone down. In another word we can say market index is scale or measure of market with the help of index we can judge the performance of overall stock market. In to index include some important companies selected by stock exchange. This is bunch of companies known as index. Often market index is used as a benchmark portfolio performance. It is used as a reflector of investor sentiment. market indexes are used for sorting and comparison for the various companies. Ex. BSE and NSE in BSE Sensex is index with 30 companies and NSE nifty is index with top fifty companies known as nifty fifty. Some sectorial index also traded in India like Bank nifty, midcap index, nifty50  index etc.

 

 What is BSE? What is Sensex?

   

                                          source BSE
 

       Sensex also called as BSE 30 is the market index consisting of 30 will established and financially well sound companies listed in Bombay Stock Exchange. All this 30 companies are selected on the basis of V float market capitalization these are different companies from different sectors representing a sample of large liquid and representative companies the base year of June 6 was 1978-79 and the base value is 100 index point. since X is an indicator of market movement if since X go up it means that most of this talks in BSE in India went up during that period of time if the Sensex goes down this tells you that the stock price of most of the major stocks of BSE has gone down. For example suppose that since X is 26,000 today if in six drops to 25,950 tomorrow it means that the majority of the 30 company's financial condition is not good and its share price is falling.

What is NSE? What is Nifty50?
     

                                          source NSE

National stock exchange (NSE) the national stock exchange is a leading stock exchange in India located in Mumbai Maharashtra. It was started to end the monopoly of Bombay Stock Exchange in the Indian market NSE was established in 1992 as the first utilized electronic exchange in India. It has a market capitalization of over 2.27 trillion US dollar making its world’s 11th largest Stock Exchange as of April 2018. NSE's index the nifty 50 is used extensively by indicators in India and around the world as a barometer of Indians capital market.

What is nifty50?

     Nifty50 is the National Stock Exchange of India's benchmark stock market index for Indian equity market nifty is owned and managed by Indian index services and products. The base year is taken as 1995 and the base value of nifty is taken to a 1000 index point. Nity50 is calculated on 50 stocks actively traded on market. Fifty top stocks are selected from different 14 sectors

     Note the Sensex and nifty are both indicators of market moment if the Sensex or nifty goes up it means most of the stocks in India goes up during that period of time. When Sensex nifty increases it shows better condition of Economy. For example during the Indian recession of 2008-2009 market was fall around 60%. Means people were selling the shares and the economic condition of the country was not good.