What are Sensex and Nifty? and What Is The Difference Between Them?

If you want to earn money by trading or investing in share market but you do not have complete knowledge of Sensex and Nifty then you can never earn money from share market because Sensex and Nifty are two very important parts of share market. Often you must have heard or seen this in TV or newspaper like:

Sensex went up so many points today

Today there was a huge fall in Sensex and Nifty

Investors suffered huge losses due to the fall of Sensex and Nifty.

So why is it shown in the news and why is it so popular?

That is probably because you can know the condition of the stock market only by looking at Sensex and Nifty, you can find out whether the market will go up or down today. That is why it is very important for you to have complete knowledge about Sensex and Nifty.

After reading this post, all the questions you have about Sensex and Nifty will be answered like;

  • What is Sensex and Nifty
  • What is the difference between Sensex and Nifty
  • Why Sensex and Nifty rise and fall
  • How does Sensex and Nifty work
  • How many and which companies come in Nifty and Sensex
  • How are Sensex and Nifty formed and how to calculate them?
  • Can the same company be listed on both BSE and NSE?

Today we are going to tell you the answers of all these questions in very easy language by example, then definitely read this post till the end. I guarantee you that after reading this post, you will not have any question related to Sensex and Nifty left in your mind.

What are Sensex and Nifty?

Sensex and Nifty is a benchmark index of India’s top companies which shows the performance of the country’s largest companies. Based on the performance of these top companies, the price of Sensex and Nifty increases or decreases.

Simply put, Sensex and Nifty are such numbers or numbers or there is a value which shows the fluctuations in the stock market, this value is called Sensex or Nifty. By its increase or decrease, it is known that the biggest companies of the country are making profit or loss.

If the Sensex or Nifty rises or goes up or there is a jump in it, then it means that the biggest companies of the country are making profit and due to this increase, the share price of these companies also increases. And at the same time it is said that the Sensex has risen so much today that investors have profited and that profit is also because the people who have bought the shares of these top big companies, when their share price increases. So they can earn profit by selling the shares.

Conversely, when the Sensex or Nifty falls or goes down or falls, it means that the biggest companies of the country are incurring losses and the share price of these companies is going down. And at the same time it is said that today there was a huge fall in Sensex and Nifty due to which people lost crores.

So now you must have understood that why people lose or gain crores due to the rise or fall of Sensex and Nifty. That’s because with the rise of Sensex and Nifty, the price of the stock increases and with the decrease, the price of the stock decreases.

We will also tell you further why this Sensex and Nifty are decreasing or increasing, apart from this, there are many other things, keep reading further-

What are stock exchanges?

As we know stock market is a place where we buy and sell stocks of companies, there are two markets to buy and sell stocks in India, first Bombay Stock Exchange (BSE) and second National Stock Exchange (NSE).

Top companies of India are listed on these two stock exchanges and then we buy their shares. Every company has the right whether it has to be listed on BSE or on NSE. If the company wants, it can also be listed on both the exchanges. Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) come in the list of top 10 stock exchanges in the world.

There are more than 5000 companies listed in BSE , out of which only 500 companies are such which alone account for 90% of the entire market capitalization while more than 1600 companies are listed in NSE .

Just as BSE and NSE are the two main stock exchanges in India, in the same way there is a stock exchange in the international market like ” New York Stock Exchange ” in America and ” Japan Exchange Group ” in Japan, so they are different in big countries too. There is a different stock exchange and every stock exchange has a different index like Nifty and Sensex like Japan’s index name is “ Nikkei 225 ”

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