BSE-S&P JV launches Sensex-50 index
The index covers approximately 54% of total market capitalization of the BSE-listed companies as of 30 October, 2016
Mumbai: Asia Index Pvt. Ltd, a joint venture between S&P Dow Jones Indices and BSE Ltd, launched the S&P BSE Sensex-50 Index on Tuesday, which is designed to measure the performance of the 50 largest companies listed on the stock exchange.
The index covers approximately 54% of total market capitalization of the BSE-listed companies as of 30 October, 2016.
“As market is expanding, there is always a demand for different types of indices. We already had BSE 100 & BSE200 ,and we thought a 50-stock index is also something that the market was expecting," Mahavir Kaswa, product manager at Asia Index Pvt. Ltd, said in a phone interview.
The Sensex-50 Index is rebalanced semi-annually, effective at the opening of the Monday following the third Friday of June and December, the index provider said in a statement.
The rebalancing reference date is the last business day of April and October, respectively. The first value date of this Index goes back to 15 December, 2005. The current value of the index is 8,382.72 points.
“Sensex-30 will remain our key index, but we will also see that this (Sensex-50) index gets traction in the market," added Kaswa.
Sensex-50 could compete with rival National Stock Exchange’s (NSE) 50-share benchmark index Nifty. NSE currently has around 86% market share in cash equities and nearly 100% share in equity derivatives.
BSE also plans to launch derivatives based on this newly launched index.
“We look forward to have derivative based contracts on this index, at BSE’s international stocks exchange in the Gujarat International Finance Tec-City (GIFT) in Gandhinagar," Ashish Kumar Chauhan, managing director & CEO, BSE Ltd, said in the statement announcing the launch of the Sensex-50 index.
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