Capital Market Index

Prerpared By Subhasis Raha (06) Anusha Venkat (07) Abhijit Kumar Basu (16) Romit Talukder (22) Ayush Keshan (23) Tanushree Dutta (28)

Financial Market
is a market in which people and entities can trade financial secur ities, commodities and other fungible items prices that reflect supply and demand.

Types of Financial Market

Stock Market- Provide financing through the issuance of shares Bond Market-Provide financing through the issuance of bonds. Commodity Market- which facilitate the trading of commodities. Money Market which provide short term debt financing and investment. Derivative Market- which provide instruments for the management of financial risk. Future Market- which provide standardized forward contracts for trading products at some future date. Insurance Market- which facilitate the redistribution of various risks. Foreign Exchange Market- which facilitate the trading of foreign exchange

Capital Market
Is defined as a market in which money is provided for periods longer than a year. Is a market for securities (debt or equity), where business enterprises and government can raise long-term funds.

Capital Market Instruments

SECURED PREMIUM NOTES EQUITY SHARES WITH DETACHABLE WARRANTS FULLY CONVERTIBLE DEBENTURES WITH INTEREST EQUIPREF SWEAT EQUITY SHARES TRACKING STOCKS GLOBAL DEPOSITORY RECEIPTS/ AMERICAN DEPOSITORY RECEIPTS FOREIGN CURRENCY CONVERTIBLE BONDS(FCCBs) DERIVATIVES HEDGE FUND EXCHANGE TRADED FUNDS

Indian Capital Market

Stock Market Index

A stock market index is a bunch of stocks grouped together to measure a certain sector (utilities, banks, tech stocks, etc.) of the stock market.

Indian Stock Market

Indian Stock Market is one of the oldest in Asia. Its history dates back to nearly 200 years ago. BSE and (NSE) are the country's two leading Exchanges. There are 20 other regional Exchanges, connected via the Inter-Connected Stock Exchange(ICSE).

BOMBAY STOCK EXCHANGE

Location-Mumbai,India Founded1875 Owner-Bombay Stock Exchange Limited Key people-Madhu Kannan (CEO & MD) Currency-Indian rupee No. of listings-5,133 MarketCapUS$1 trillion (Dec 2011) Indexes BSE Sensex BSE Small Cap BSE Mid-Cap BSE 500 Websitewww.bseindia.com

NATIONAL STOCK EXCHANGE

Type-Stock Exchange LocationMumbai,India Founded1992 Key peopleRavi Narain (MD) No. of listings1,646 MarketCapUS$985 billion (Dec 2011) Indexes S &P NIFTY JUNIOR S &P CNX 500 S& P CNX NIFTY(Standard & Poor's CRISIL NSE Index) CNX Nifty Junior CNX 100 (= S&P CNX Nifty + CNX Nifty Junior) S&P CNX 500 (= CNX 100 + 400 major players across 72 industries) CNX Midcap (introduced on 18 July 2005 replacing CNX Midcap 200)

Stock Market Index India

Stock market indices are the barometers of the stock market. They mirror the stock market behavior with respect to various economic conditions. 2 most important indexes which are followed daily are SENSEX and NIFTY( NSE FIFTY). Nifty is more stable than Sensex. This is mainly due to improved diversification and better liquidity position in Nifty

BSE
SENSEX- The Barometer of Indian Capital Markets 'BSE MID-Cap' index and 'BSE Small-Cap' index to track the performance of companies having smaller market capitalization. BSE-500 Index represents more than 93% of the listed universe Companies with large market capitalization.

BSE Sector Series (90/FF) Indices

BSE Auto Index BSE BANKEX BSE Capital Goods Index BSE Consumer Durables Index BSE FMCG Index BSE Healthcare Index BSE IT Index BSE Metal Index BSE Oil & Gas Index BSE Power Index BSE Realty Index

NSE
S&P CNX Nifty - is a well diversified50stock index accounting for21 sectors of the economy. S&P CNX 500 - The S&P CNX 500 is Indias first broad based benchmark of the Indian capital market. CNX Midcap - The primary objective of the CNX Midcap Index is to capture the movement and be a benchmark of the midcap segment of the market.

NSE
CNX MNC Index - The CNX MNC Index comprises 50 listed companies in which the foreign shareholding is over 50% . CNX PSE Index The CNX PSE Index includes only those companies that have over 51%of their outstanding share capital held by the Central Government and/or State Government, directly or indirectly. S & P CNX DEFTY Index- S&P CNX Deftyis S&P CNX Nifty, measured in dollars

S&P CNX Industry Indices S&P CNX 500 Equity Index is desegregated into 72 Industry sectors which are separately maintained by IIS

Ways of calculating Stock Index (SENSEX)

Free float Market Capitalization An index constructionmethodology that takes into co nsideration only freefloatmarket capitalization of a co mpany for the purpose of index calculation and assigning weight to stocks in the index.
Index at time ti= t0 * (FFMC at ti / FFMC at t0) FFMC= Free Float Market Capitalization(FiPi) ti= current time t0= previous time

Market Capitalization = No of Shares * Price of share

Base Market capitalization Adjustment

Due to right issue Due to bonus issue

The formula for adjusting the Base Market capitalization is as follows: New Base Marketcapitalization= Old Base Marketcapitalizationx(New Marketcapit alization/Old Marketcapitalization)

Bibliography
http://en.wikipedia.org/wiki/BSE_SENSEX http://en.wikipedia.org/wiki/National_Stock_Exchang e_of_India http://en.wikipedia.org/wiki/S%26P_CNX_Nifty http://www.rediff.com/money/2008/feb/21bspec.ht m http://www.indianmba.com/Faculty_Column/FC316/ fc316.html

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