Difference between Sensex and Nifty

Difference between Sensex and Nifty

Nifty - The National Stock Exchange Fifty (Nifty) is the National Stock Exchange (NSE) flagship stock price index. Often recognized as NIFTY 50 or CNX Nifty, it contains the top 50 stocks in terms of market capitalization. These stocks are amongst the most actively traded on NSE and the index managed and run by NSE subsidiary India Index Services and Products Ltd. (IISL). The index's base value was 1000 at the time of formation in November 1995.  The index is calculated using the weighted form of free-float market capitalization, which implies that the higher free-float market cap companies receive a higher weightage in the index.

Sensex - Also recognized as the Sensitive Index is the flagship stock index of the Bombay Stock Exchange (BSE). Sensex is an economy-weighted stock index with a base value of 100 set at the time of formation of the index in April 1979. The Sensex contains shares of the top 30 market capitalization companies. In addition, Sensex is calculated using the method of free-float market capitalization and the performance of the selected 30 shares is directly reflected by the index level.

Both the Nifty 50 and the Sensex are taken as proxies for the performance of the Indian economy since they represent the top companies of the country.

Differences between Nifty and Sensex

Full Form and Ownership- Nifty is an amalgamation of the words National and Fifty, while Sensex stands for Sensitivity and Index. Nifty is operated by Index and Services and Products Limited (IISL) and Sensex is owned by the Bombay Stock Exchange (BSE).

Number of Sectors Covered - The Nifty50 index covers 24 sectors whereas Sensex covers 13 sectors.

Amount of constituents - Nifty has 50 stocks that have been actively traded on NSE and Sensex has shares of the top 30 well-established companies depending on their success and financial soundness.

Market Capitalisation - For Nifty, NSE market capitalisation is approximately 29% whereas Sensex 30 Index share of base market is approximately 25%.

Foreign Exchange Trade - Nifty gets traded on the Singapore exchanges as SGX Nifty and on Chicago Mercantile Exchange as CME Nifty whereas Sensex gets traded over Dubai Gold and Commodity Exchange, DGCX.