What is SENSEX, NIFTY and INDEX?

SENSEX is the index of the Bombay Stock Exchange (BSE) and NIFTY is the index of the National Stock Exchange (NSE). BSE was established in the year 1992 where 2000 companies are registered in it while NSE was established in the year 1875 where 5000 companies are registered in it.

Now, we will know about INDEX or Stock Market Index. Stock Market Index is nothing but an index that measures a Stock Market or a Sub-set of the Stock Market that helps investors compare current price levels with past prices or LTP to calculate market performances. Stock Market Index indicates that the performance of Stock Market indicates the performance of the economy.

Let us look into the Application of Stock Market Index and they are as follows -

1. To evaluate the performance of a Stock Market and get an idea about the economy.

2.  For benchmarking Investment Portfolios.

At last, we will know about Sector Index. Sector Index is something that gives summaries and benchmarking data for certain sectors or industries as it allows investors to track a stock against specific sectors.