Nifty and Sensex Explained for Beginners

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What an index is

An index is a number that tracks a group of shares. When the number rises, the group has gone up on the whole. It gives a quick view of the market without checking every company.

Nifty 50

The Nifty 50 is the index of the National Stock Exchange (NSE). It tracks 50 large companies from different sectors.

Sensex

The Sensex is the index of the Bombay Stock Exchange (BSE). It tracks 30 large and well-established companies.

What it does not tell you

An index shows the overall picture, not how each share is doing. You cannot buy an index directly, but products linked to indexes exist, and they carry market risk like anything else.

Key points

• An index tracks a group of shares.
• Nifty 50 belongs to NSE and has 50 companies.
• Sensex belongs to BSE and has 30 companies.
• An index shows the overall market, not each share.

Trading involves risk. This article is for education and information only. It is not investment advice, and no course or method promises a return or removes the risk of loss.