India Economic development- I

 The economy of India today presented two faces very different: a high dynamism and growing prosperity, especially since 2003, and another in which there is fragilities substantial, major challenges of development and, above all, poverty yet extreme. It is understandable that the Government of New Delhi wants to emphasize the first on tiptoe and pass by the second, but to have a vision of the appropriate country, it must examine together the two realities.

 Summary coming in next posts: This analysis looks at first, the causes, manifestations and main effects of rapid economic growth that has seen India from 2003. Secondly, briefly analyzes the economic risks in the short term, connected especially with a growing financial vulnerability and an insufficient job creation. Thirdly, the analysis stops on the demands that the pattern Development must meet from now to be able to sustain in the medium and long term, a growth rate equal to or higher than in recent years. Fourth, states that the task is still huge, given the extreme underdevelopment of most of the country.

Selection of Companies

The criteria used for selecting the constituent companies are: 

Quantitative:

 - What are the Top 100 companies in the ranking final

 - Have movements each day during the past 6 months

 - Having a weight of at least 0.5% in the index based on the average semiannual 

- Being a leader in its sector 

- Have at least 3 months old on the BSE 

Qualitative:

- Have a path acceptable in view of the Committee 

Method of calculating Sensex

Senex is calculated using a market capitalization of free-floating, taking into account the overall proportion of shares that are actually available in the market. The value of the index at a given point represents the market value of freeflotation of the 30 securities that comprise it in relation to a year and a base value (1978 -- 79 = 100) First, it calculates the market capitalization of each company constituents by multiplying the number of shares outstanding by the price in the market, it weighs the weight of each company in the market. The result is applied a factor to get the free float market capitalization of free flotation, which is divided by An index divisor to link it to the base year and thus be able to make comparisons, obtaining the value of the SENSEX

As mentioned earlier, the index takes into account the actions that are actually on the market, not including: 

- The belonging to or founding directors that include elements of control

- The people or companies with interests in control 

- The government as a sponsor or buyer 

- The route acquired by foreign investment 

- The shares of strategic corporate or individual institutions

 - Capital owned by associations, companies or groups of Foundations

The BSE determines the free-float factor to be applied based on detailed data companies must submit. So you get the percentage of market capitalization that are considered for the construction of the index. Finally divisor factor applied to the base 1978-79 = 100.

What is sensex?

SENSEX, is the common name for Bombay Stock Exchange Sensitive Index. It is an index weighted by market capitalization market values of 30 representing a sample Companies large, well established and financially sound belonging to several sectors in the Bombay Stock Exchange, Bombay Stock Exchange (BSE) It is the oldest index (provides data series since 1978-79 1 ) And has acquired a unique position in the minds of investors. It is regarded as the barometer more popular and accurate for measuring changes in the securities markets and represents Indians also a universe of underlying securities in the stock market. From time to time, the authorities of the BSE review and modify its composition to ensure that it reflects current market conditions

The SENSEX is the benchmark of capital markets generally Indians accepted among private investors, institutional and foreign fund managers. Their main objectives are: -

 Measure the market movements - 

Serve as a reference point for fund managers and the blue chip COMPANIES 2 to compare the evolution of its funds -

 Serve as a basis for index derivatives such as futures or options