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How sensex is calculated?
Posted by: Sunny sharma in Genius Young Minds. 3 years ago, Total Answer(s): 2

Answer(s)

Sensex is calculated using the "Free-float Market Capitalization" methodology. As per this 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 capitalization of a company is determined by multiplying the price of its stock by the number of shares issued by the company. This market capitalization is further multiplied by the free-float factor to determine the free-float market capitalization.
By: Deepak Bansal, 3 years ago
The calculation of SENSEX involves dividing the total market capitalization of 30 companies in the Index by a number called the Index Divisor. The Divisor is the only link to the original base period value of the SENSEX. It keeps the Index comparable over time and is the adjustment point for all Index maintenance adjustments. During market hours, prices of the index scrip, at which latest trades are executed, are used by the trading system to calculate SENSEX every 15 seconds and disseminated in real time.
By: Deepak Bansal, 3 years ago

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