What is Sensex and Nifty? – Full Form of Nifty & Difference Between Them



You are searching about What is Sensex and Nifty, Full-Form of Nifty and Difference Between Sensex and Nifty that shows you are going in the right direction. Because having the basic knowledge of the Stock Market is necessary before going to Invest in Share Market.

What we learn in this article is:

If you are a novice in the Share Market then you should learn about it first and you must refer our in-depth guides about How Share Market Works, Share Market Tips.

I am going to give you a short brief about Share Market here that will help you to learn better about Sensex and Nifty.

In short, The Stock Market is a place where Buyer and Seller collaborate to Trade the publicly listed compony Stocks.

Full-Form of Sensex

The full-form of Senses is defined as – Stock Exchange Sensitive Index that comprises the 30 largest and most traded stocks of BSE. The Sensex is also known as the BSE 30 and it is considered the oldest Exchange in India.

Full-Form of Nifty

Nifty doesn’t have a character-by-character spell full-form. But the full-form of Nifty is described as – National Stock Exchange Fifty. That means the combination of Fifty Stocks of NSE.

What is Sensex

Sensex is mainly the index that represents the BSE (Bombay Stock Exchange). It is considered one of the oldest Stock Exchange in India that was established back in 1875. Sensex is formed by 30 largest and highly liquid stocks of BSE.

Here you can understand in simple words. There are around 8900 stocks are listed on the Bombay Stock Exchange (BSE) and out of these only the best 30 stocks chosen by BSE to form Sensex Index.

The price of Sensex is derived by the weighted average price of these 30 Best Stocks of BSE.

What is Nifty

As I mentioned earlier the Nifty 50 Index is the Benchmark Index of the National Stock Exchange of India for the Indian Equity Market. I also explained that the Index is formed with a combination of 50 Best Stocks of NSE.

If you are still confused what does it mean you don’t need worry. Because I’ll explain in simple language.

1000s of Stocks are listed on National Stock Exchange and publically traded at the secondary market. Out of these stocks, NSE chooses the best 50 Stocks with large market capitalization and liquidity to form the Nifty 50 Index.

Here, you might want to know that if Nifty is a bunch of 50 Stocks than how the price of Nifty is defined. The Nifty Price is defined from these 50 Stock’s price as a Weighted Average. Or in simple words, the average price of these 50 stocks is the Price of Nifty 50.

What is Sensex and Nifty

Sensex is the benchmark index of the Bombay Stock Exchange of India (BSE) and known as the S&P BSE Sensex Index. Sensex holds 30 largest and most traded company’s Stocks on the BSE that reflects the current economy of India.

Where Nifty 50 also known as Nifty 50 Index is the benchmark index of the National Stock Exchange of India (NSE). Nifty comprises 50 largest and most traded stocks on NSE and represent the weighted average of these compony’s stocks from 13 Sectors.

Difference Between Nifty and Sensex

A lot of differences are between Sensex and Nifty, here are they:

  • Nifty comprises 50 Stocks from NSE and Sensex comprises 30 Stocks from BSE
  • Nifty represents NSE (National Stock Exchange of India) and Sensex represents BSE (Bombay Stock Exchange of India)
  • Nifty was introduced in 1995 (November 3, 1995) and Sensex was introduced in 1986 (January 1, 1996)
  • Nifty situated in New Delhi and Sensex situated in Bombay (Mumbai)

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