According to Wikipedia, “The S&P BSE SENSEX (S&P Bombay Stock Exchange Sensitive Index), also-called the BSE 30 or simply the SENSEX, is a free-float market-weighted stock market index of 30 well-established and financially sound companies listed on Bombay Stock Exchange. The 30 component companies which are some of the largest and most actively traded stocks, are representative of various industrial sectors of the Indian economy.”
Now, please read this: News on weight-age of Sensex: http://economictimes.indiatimes.com/markets/stocks/news/why-dii-buying-failed-to-stabilise-markets/articleshow/48906993.cms
In this light, can we attempt these basic questions:
1. Given the weights, can we re-define the index?
2. Given the span of many utility, core industry companies floating their shares, can we include some more companies in the index?
3. Are we really capturing the market sense in the long run using the definition of the indexes?
4. Only 30 blue-chips, can we take a stance to re-define the index with some additions and subtractions?
5. Can we include the top 5 companies of every sector by market share volume or market cap to indicate the sensex?
6. What is the weight that we should attach to the industries and also subsequent companies?
7. What are the indicators of weight of the Sensex?
8. How does algo-trading work in the long run? Even a big-fan of high frequency trading would know that it is not ready to be used in BSE!
9. Can we provide FIIs more balance in terms of capital investment in capital markets?
10. Can we help to make the DIIs more frequent in trading?
If you are reading my 100th article here, can we pledge for a better sustainable tomorrow!