Information – Knowledge +
How the Sensex is calculated
How the Sensex is calculated
Sharat Chandran, Commodity Online
For the premier Bombay Stock Exchange that pioneered the stock broking activity in India, 128 years of experience seems to be a proud milestone. A lot has changed since 1875 when 318 persons became members of what today is called The Stock Exchange, Mumbai by paying a princely amount of Re 1.
Since then, the country’s capital markets have passed through both good and bad periods. The journey in the 20th century has not been an easy one. Till the decade of eighties, there was no scale to measure the ups and downs in the Indian stock market. The Stock Exchange, Mumbai in 1986 came out with a stock index that subsequently became the barometer of the Indian stock market.
Sensex is not only scientifically designed but also based on globally accepted construction and review methodology. First compiled in 1986, Sensex is a basket of 30 constituent stocks representing a sample of large, liquid and representative companies.
The base year of Sensex is 1978-79 and the base value is 100. The index is widely reported in both domestic and international markets through print as well as electronic media.
The Index was initially calculated based on the “Full Market Capitalization” methodology but was shifted to the free-float methodology with effect from September 1, 2003. The “Free-float Market Capitalization” methodology of index construction is regarded as an industry best practice globally. All major index providers like MSCI, FTSE, STOXX, S&P and Dow Jones use the Free-float methodology. (See below: Explanation with an example)
Due to is wide acceptance amongst the Indian investors; Sensex is regarded to be the pulse of the Indian stock market. As the oldest index in the country, it provides the time series data over a fairly long period of time (From 1979 onwards). Small wonder, the Sensex has over the years become one of the most prominent brands in the country.
The growth of equity markets in India has been phenomenal in the decade gone by. Right from early nineties the stock market witnessed heightened activity in terms of various bull and bear runs. The Sensex captured all these events in the most judicial manner. One can identify the booms and busts of the Indian stock market through Sensex.
Sensex Calculation Methodology
Sensex is calculated using the “Free-float Market Capitalization” methodology. As per this methodology, the level of index at any point of time reflects the Free-float market value of 30 component stocks relative to a base period. The market capitalization of a company is determined by multiplying the price of its stock by the number of shares issued by the company. This market capitalization is further multiplied by the free-float factor to determine the free-float market capitalization.
The base period of Sensex is 1978-79 and the base value is 100 index points. This is often indicated by the notation 1978-79=100. The calculation of Sensex involves dividing the Free-float market capitalization of 30 companies in the Index by a number called the Index Divisor.
The Divisor is the only link to the original base period value of the Sensex. It keeps the Index comparable over time and is the adjustment point for all Index adjustments arising out of corporate actions, replacement of scrips etc. During market hours, prices of the index scrips, at which latest trades are executed, are used by the trading system to calculate Sensex every 15 seconds and disseminated in real time.
Dollex-30
BSE also calculates a dollar-linked version of Sensex and historical values of this index are available since its inception.
Understanding Free-float Methodology
Free-float Methodology refers to an index construction methodology that takes into consideration only the free-float market capitalisation of a company for the purpose of index calculation and assigning weight to stocks in Index. Free-float market capitalization is defined as that proportion of total shares issued by the company that are readily available for trading in the market.
It generally excludes promoters’ holding, government holding, strategic holding and other locked-in shares that will not come to the market for trading in the normal course. In other words, the market capitalization of each company in a Free-float index is reduced to the extent of its readily available shares in the market.
In India, BSE pioneered the concept of Free-float by launching BSE TECk in July 2001 and Bankex in June 2003. While BSE TECk Index is a TMT benchmark, Bankex is positioned as a benchmark for the banking sector stocks. Sensex becomes the third index in India to be based on the globally accepted Free-float Methodology.
Example (provided by rediff.com reader Munish Oberoi):
Suppose the Index consists of only 2 stocks: Stock A and Stock B.
Suppose company A has 1,000 shares in total, of which 200 are held by the promoters, so that only 800 shares are available for trading to the general public. These 800 shares are the so-called ‘free-floating’ shares.
Similarly, company B has 2,000 shares in total, of which 1,000 are held by the promoters and the rest 1,000 are free-floating.
Now suppose the current market price of stock A is Rs 120. Thus, the ‘total’ market capitalisation of company A is Rs 120,000 (1,000 x 120), but its free-float market capitalisation is Rs 96,000 (800 x 120).
Similarly, suppose the current market price of stock B is Rs 200. The total market capitalisation of company B will thus be Rs 400,000 (2,000 x 200), but its free-float market cap is only Rs 200,000 (1,000 x 200).
So as of today the market capitalisation of the index (i.e. stocks A and B) is Rs 520,000 (Rs 120,000 + Rs 400,000); while the free-float market capitalisation of the index is Rs 296,000. (Rs 96,000 + Rs 200,000).
The year 1978-79 is considered the base year of the index with a value set to 100. What this means is that suppose at that time the market capitalisation of the stocks that comprised the index then was, say, 60,000 (remember at that time there may have been some other stocks in the index, not A and B, but that does not matter), then we assume that an index market cap of 60,000 is equal to an index-value of 100.
Thus the value of the index today is = 296,000 x 100/60,000 = 493.33
This is how the Sensex is calculated.
The factor 100/60000 is called index divisor.
Class X exams: 7 tips to finish your maths paper before time
Class X exams: 7 tips to finish your maths paper before time
Suresh Kumar, TCYonline.com
Many students, even some really intelligent and talented ones, have a strange enemy. They often find it difficult to finish the paper within the allotted time. They are forced to leave a few questions just because they run out of time and often it has been found that the questions they leave are those which they otherwise could do very easily. It can be very disappointing if you are forced to skip such easy questions.
But how can you avoid a situation like this? Many people suggest a single tablet for this “Time management”. But how to manage time and how to stop it from running out is a difficult proposition, especially for an average 14-15-year-old tenth grader.
Here are certain tips by experts from TCYonline.com to help you out to finish your paper well before time.
1. Understand your exam
The most important thing is to understand the examination you are about to take. In the class X mathematics paper, there are 30 questions in four sections A, B, C and D and we have 180 minutes to answer these questions. Here, a rough calculation is that we get about six minutes to answer a question. But that is not the fact.
The question paper contains ‘very short answer’ type, ‘short answer’ type and ‘long answer’ type questions and the time requirement for each type is different. An ideal allotment for the four sections is as shown below:
Section A 10×2 20 minutes
Section B 5×4 20 minutes
Section C 10X5 50 minutes
Section D 5×10 50 minutes
2. Use the first 15 minutes effectively
You get a good 15 minutes in the beginning to read the question paper — use this time to do just that, READ. Read all the 30 questions in 15 minutes. While reading, mark the questions into categories viz easy, manageable and tough. This is done to have an overall idea about the questions and make a rough plan.
3. Don’t worry about the tough ones
The moment you find that there are a few tough questions; it is natural that you start worrying about them. This is not required and will only harm your performance.
The fact is that they may look a bit tough on the surface, but when you actually work on them you will find most of them to be much easier than they seemed. So be happy about the easy ones and don’t get unduly worried about the tougher lot.
4. Prioritise your attempt
Always attempt the easy questions first and then move on to the manageable ones and ensure that you complete them before taking on the difficult ones. This will ensure that you are not leaving any question that you know.
Once you successfully attempt all the easy and manageable questions, your confidence will grow and you will be mentally ready to take on the more challenging questions.
5. Ensure speed and accuracy
Use quicker methods in calculations to ensure that you are not wasting time and your answers are correct. Mostly, we take a lot of time to solve a problem if we happen to make some error in the process.
For example, if you make an error in the sign of a term (+/-), you may not be able to solve questions involving quadratic equations or linear equations. Therefore avoiding silly mistakes is very important to save time. Always follow the tricks we discussed in speed strategies.
6. Keep an eye on your watch
Keeping an eye on your watch is of course not to increase your stress. This is just to see that you are broadly adhering to the time allocation we discussed in the beginning. A minor variation is not at all a reason to worry.
7. Avoid thinking too much about a question
Thinking about the questions before you attempt them is essential; but not to such an extent that you waste a lot of time on one question.
Also you need not write a very lengthy answer to a question just because the question is easy and you know it very well. Remember, you need to just answer the question and nothing more. Any over-attempt will be a mere waste of time.
Additionally, you must practice the habit of finishing samples papers in 140-150 minutes. This will help you simulate and exercise examination pressures better.
Web application to track browser history
Web application to track browser history
Avid net surfers who want to keep track of information they have browsed earlier without duplicating effort, now have a unique web application that helps them locate information in a jiffy from their previously browsed pages.
“Hooeey enables internet users to re-use their browsing history in a productive manner to reduce time spent in searching for previously visited web pages, to easily share interesting web pages with others and use the provided dashboard to manage their browsing time more efficiently”, Rajiv Purnaiya, Managing Director, Hooeey, told PTI.
While providing a safe and universal platform for the entire browsing experience, Hooeey delinks the browser history from the browser. Additionally, Hooeey adds a social networking layer, allowing one to share specific sites with others, both on Hooeey network and other social bookmarking services.
Hooeey services can be accessed for free at http://www.hooeey.com.
“Our main focus is to save time and effort of the users by leveraging IT tools and adopting a different approach that combines seamless web hop recording with complete transparency and user control”, said Rajiv, the founder of CyberBazaar (acquired by WebEx), the first firm in the country to provide audio and video and web conferencing.
Hooeey allows the users to track all their browsing history from any search engine and “also has the advantage on browser’s history files as it works on both platforms like Internet Explorer and Firefox.
Some distinctive features of Hooeey include: records web hops automatically, interesting sites can be tagged while a user is online or offline, one can create a contact list and send links to friends, has self-determinable folders which help to structure links.
“It is completely automatic and does not require any user intervention. The application can be plugged into your browser and then a user can create a Hooeey online account if he wishes to store the information,” Rajiv said.
Every page that the user goes to is recorded in the application along with the time and date and one does not have to manually bookmark any page. In case, the user does not want to record the information, there is a one-click stop.
To keep track of all data, Hooeey has built-in analytics service which breaks down browsing habits with various helpful charts and graphs. Thereafter, one can hand pick any site for tagging and sharing.
User’s privacy, said Rajiv, is of paramount importance. “Our approach is based on complete transparency and the user is always in control. We have added some specific tools and features especially to make the user feel at ease.”
“We are targeting the application at avid surfers, researchers, students and even journalists. Enterprises and companies can also use hooeey to aggregate the knowledge base that their employees are adding on a daily basis”, he said.
The company has kept its options open on the suggestions made on the web application by the target audience, Rajiv said.
Women memorise better than men
Women memorise better than men
ANI
WASHINGTON: Women are better than men at memorising things in certain respects, according to a new study.
Psychologists Agneta Herlitz and Jenny Rehnman in Stockholm, Sweden, have discovered that women can excel in verbal episodic memory tasks like remembering words, objects, pictures or everyday events.
The researchers have also found that men can outperform women in remembering symbolic, non-linguistic information, known as visuospatial processing. According to them, this result indicates that a man is more likely to remember his way out of the woods than a woman.
However, their study also suggests that women are more likely than men to remember the location of car keys, which involves both verbal and visuospatial processing.
“In addition, women are better than men at remembering faces, especially of females, and the reason seems to be that women allocate more attention to female than to male faces,” say Herlitz and Rehnman.
In the course of the study, three groups of participants were presented with black and white pictures of hairless, androgynous faces. The researchers described the pictures as that of ‘female faces’, ‘male faces’ or just ‘faces’.
It was found that women were able to remember the androgynous faces presented as female more accurately than the androgynous faces presented as male.
The researchers also discovered that women performed better than men in tasks requiring little to no verbal processing, such as recognition of familiar odours. They said that the female episodic memory advantage increased when women utilized verbal abilities, while it decreased when visuospatial abilities were required.
The researcher duo believes that environmental factors, such as education, also seem to influence the magnitude of these sex differences. They concede that the probability of genetically-based differences between the quality of male and female memory is still unknown.
The findings appear in the journal Current Directions in Psychological Science .
Experts create mother of all lasers
Experts create mother of all lasers
IANS
NEW YORK: Scientists have developed the mother of all laser beams — one that has focussed power equal to all the sunlight heading Earth’s way.
Researchers at the University of Michigan recently created the record-setting beam, which measures 20 billion trillion watts per square centimetre, Sciencedaily reported. “I don’t know of another place in the universe that would have this intensity of light. We believe this is a record,” said Karl Krushelnick, who was part of the team that created the laser.
The laser contains 300 terawatts of power, or 300 times the capacity of the entire US electricity grid, and its power is concentrated in a 1.3-micron speck — about one-100th the diameter of a human hair.
Of course, a beam like this cannot be sustained for long. This one lasted just 30 femtoseconds. A femtosecond is a millionth of a billionth of a second, the researchers said in a paper published in the online edition of the journal Optics Express.
Such intense beams could help scientists develop better proton and electron beams for radiation treatment of cancer, among other applications. The laser can produce this intense beam once every 10 seconds, whereas other powerful lasers can take an hour to recharge.
The team managed to get such high power by putting a moderate amount of energy into a very, very short time period. In addition to medical uses, intense laser beams like these could help researchers explore new frontiers in science.
Kids become goal oriented at 3
Kids become goal oriented at 3
ANI
WASHINGTON: Researchers at the University of Cambridge have found that kids exhibit goal-oriented behaviour as early as the age of 3.
The study found that by around the age of 3, children appear to shape their behaviour in response to the outcomes they’ve come to expect.
Anticipated outcomes that kids value, move them to act more than outcomes that they don’t value – a hallmark of emerging autonomy.
For the study, the researchers trained 72 kids between 18 months and 4 years old, divided into three 10-month age bands (averaging 1.3 to 2.2 years, 2.3 to 3.075 years, and 3.08 to 4 years) to touch a red or green butterfly icon on a touch-screen display to see different cartoon video clips.
The children came to link one butterfly with one cartoon sequence and the other butterfly with another.
The researchers then devalued one of the outcomes by showing that sequence repeatedly, until the children became bored with it.
As a result, the less-viewed cartoon clips became, by contrast, more interesting and valuable.
The researchers then re-tested the kids, who should now have associated one butterfly with a valued cartoon and the other butterfly with a less-valued cartoon.
They found that relative to the younger children, those who were 32 months (nearly 3 years) and older touched the butterfly for the less-valued cartoon significantly less often than they touched the butterfly for the more novel cartoon.
During that test, the cartoons were not actually presented; the children had to rely on their memories of which butterfly icon produced which cartoon.
The study therefore showed that the actions of the older children behaviour depended on the current values of the outcomes, whereas the actions of the younger children did not.
Ulrike Klossek, PhD, co-author of the study, pointed out that although all the children were sensitive to changes in outcome value and preferred the less-repeated cartoon, only the older children actually acted in a way that, based on their experience, would get them their favourite cartoon.
The researchers said that although adults take goal-directed action for granted, it’s not in us from birth but rather emerges in a normal developmental timeline that appears to emerge roughly between the ages of 2 and 3 years.
“One possible interpretation is that the period between 2 and 3 years of age brings about a transition in behavioural control from stimulus-outcome learning to fully intentional goal-directed action,” the researchers said.
By age 3, kids can pursue specific goals even if they cannot directly sense those goals, which may now be more abstract.
The older kids are sensitive to how goals change in value, begin to internalise their relationship to and control over events, and start to act in ways that will help them achieve the goals they value most – such as more exciting cartoons.
“This capacity [to internalise one’s control over the environment] is an important component of becoming a fully autonomous intentional agent,” the researchers said.
The study is published in the February issue of the Journal of Experimental Psychology: General.
Music therapy for stroke patients
Music therapy for stroke patients
REUTERS
LONDON: A little Beethoven is good for the brain, according to a Finnish study published on Wednesday showing that music helps people recover more quickly from strokes.
And patients who listened to a few hours of music each day soon after a stroke also improved their verbal memory and were in a better mood compared to patients who did not listen to music or used audio books, the experts said. Music therapy has long been used in a range of treatments but the study published in the journal Brain is the first to show the effect in people, they added.
“These findings demonstrate for the first time that music listening during the early post-stroke stage can enhance cognitive recovery and prevent negative mood,” the experts, who were led by a psychologist from University of Helsinki, wrote. Strokes are one of the worldwide leading causes of death and permanent disability.
What you must do before you abandon your PC
What you must do before you abandon your PC
Jay Dougherty, February 21, 2008
If you’ve been using a computer for some time and need to abandon it – either because you’re leaving a job or moving to another machine – you need to be concerned about security. Simply put, once you’re gone, a lot of information can be retrieved about you just by inspecting the digital traces you leave behind.
So before you say goodbye to a PC, follow this list of to-do items to ensure that no one gains information about you that they do not need to know.
The applications on your PC keep a record of almost everything you do. By default, your Web browser probably leaves tracks from a lot of the sites you’ve visited, stores the user names you use online, the files you’ve downloaded, and even passwords, if you allow it.
Many business applications also keep track of the documents you’ve last worked on or edited. “Histories” are useful to those who need quick recall of what they last worked on, but they’re anathema to those who require privacy.
There are ways to selectively clear usage history with each of the applications that keep such records. But because it’s difficult to remember exactly which applications are keeping a record of how you’ve used a computer, a better solution is to turn to a tool that specialises in removing traces of every document you’ve worked on or website you’ve visited.
Clear History, for instance, removes the history of activity kept by most popular applications. It can clear not only document and Internet history but also can ferret down into more arcane data and registry information, removing any record of your activity.
If the PC you’ve been using contains sensitive files, it’s not enough simply to delete them. Even if you delete a file and subsequently remove it from the recycle bin, a savvy user can reconstruct deleted data and potentially gain access to files that you thought were gone for good.
So to delete sensitive files, you have to turn to something more robust than the delete key. Software-based file shredders fit the bill. Most of these applications work by scrambling the contents of a file using special algorithms.
Your e-mail probably holds plenty of information you’d rather not see fall into the hands of someone who comes along to use a computer after you. So it’s critical that you know how to destroy e-mail you do not want others to see.
First, though, that deleting e-mail from a machine that has been connected to a corporate network probably does not actually remove all traces of messages you’ve revived or sent. Many companies are required by law to keep copies of the e-mail their employees generate, so your best course of action is to plan ahead and never send sensitive information by e-mail from work.
You can delete e-mail messages individually using the Delete key on particular messages. Remember, though, that deleting e-mail messages this way just sends them to the Deleted E-mail folder, where they will need to be deleted again. Holding down the Shift key while deleting messages sends them directly to the recycle bin in Outlook and Outlook Express.
If you have the option to completely wipe out a hard drive before leaving a machine or returning it, take advantage of it. A study by researchers at Britain’s Glamorgan University showed that more than half of the used hard drives purchased from eBay contained retrievable personal and financial information.
Reformatting an old hard drive isn’t enough, since even a standard reformat can leave the data on a disk vulnerable to retrieval by savvy users.
So you need to look into disk shredding tools before passing on a hard drive that may contain sensitive information. As with file shredders, you’ll find plenty of commercial utilities that can accomplish this task, but capable free ones exist as well.
Look to the popular Darik’s Boot and Nuke (http://dban.sourceforge.net), for instance. This programme runs from a boot disk or drive and proceeds to securely erase any hard drive that it finds on a system.
A new way to search pictures
A new way to search pictures Gulf News Report Published: February 09, 2008, 01:04
Luckily for oSkope, a lot of internet users like to dig around and play with websites, because at first glance, oskope.com looks like a dud.
It isn’t. What looks like just another attempt to search for pictures is actually a good way to sort products, images and video from such major sites, such as eBay, in a way the original domain doesn’t permit.
But first things first: oSkope isn’t a general search engine. It will only search Amazon, eBay, Flickr, Fotolia, Youtube, and Yahoo! Image search.
While that may sound like a very limited search, the site does allow you to search web sites associated with the domain name.
This means that not only can uses search amazon.com they can search all of Amazon’s regional websites, including http://www.amazon.co.uk.
What really sets the site apart is the how it displays the results.
First, users don’t see lists of texts, but images of product, videos or just the pictures themselves.
Move your pointer over the images and you’ll get additional data, such as how much the product costs, the time remaining on an auction, or size of the image.
Viewing options
Users can choose various viewing options, including lists or stacks, but the most usable option is the graph. Users looking for items on eBay will be able to sort their results by price and duration of the auction.
Amazon users will be able to see products on a graph comparing popularity and price.
While the graph works best with consumer related sites, the option is also there for the video and photo sites. While you might not care how old a file is or how long it’s been online, the graph makes it easier to sort though the massive number of videos and graphics out there.
The site also has the ability to zoom in and out and the ability to save individual search results into a holding folder. With its limited searching ability, it hard to gauge how useful the site will be, but if the site can expand, it may be the first to offer a serious Web 2.0 version of the standard search engine.
A home within your budget
A home within your budget
Vidyalaxmi, TNN
You may have to live with higher residential prices. After all, in a country where citizens are increasingly flocking to big cities for job opportunities, is there any other way that property prices could go? But then if you are a smart buyer, who is willing to see through the dust, there are opportunities galore to buy that dream house. And yes, that too at an affordable cost.
There is light at the end of the tunnel for home buyers. Old houses in the same locality are available at much cheaper market rates than the newly-constructed ones. So should you toy with the idea of buying an old house? Raj Kumar of Jones Lang Lasalle Meghraj says: “That depends on one’s level of need, one’s paying ability and the condition of the house. While a new house is always a better investment, there are certainly occasional good deals available in older units, too. Units in projects by reputed builders often do have sufficient resale value, especially if they are in good locations. If the unit is in a location that meets the buyer’s need, all necessary conveniences are available in the vicinity and if it is in good condition, buying it makes sense”.
More space
The biggest advantage of going for an old house is that of getting more carpet area. This is primarily because of the low-loading factor in old constructions. Today, most of the residential constructions come with amenities such as clubhouse, gymnasium, swimming pool and all these spaces get loaded into the overall property rates. So, for instance, a new residential house might be a 1,000 sq ft home, giving only 750 square feet of carpet area (33% loading). In case of an old house, you could get probably get 800-850 sq ft.
Spruce up old homes
“Newly-built houses are usually designed keeping in mind the requirements of the existing generation. Be it more attached bathrooms with bedrooms or service area for maid servants, you name it and they have it. In contrast, older houses mostly have provision for only one bathroom, says Dharmesh Thadani, a Mumbai-based interior decorator. Even the modern kitchens are well-equipped with additional plug points and right electrical fittings. But then the big question is to ask about the incremental cost to redo the old house with such state of the art electrical fittings. But….
There are some things though, which can’t be done even if you wish for it. Take for instance, the elevators which some of the old house might not have. This could be an area of concern, especially if there are elderly members in your family. Also, one might have to forego the commonly available amenities. “The new constructions usually have large housing complexes with common facilities such as swimming pool, recreation club/gym, etc. They also have appropriate provisions like a lawn or a park for the children to play in the compound itself, adds Mr Thadani.
Renovation costs and lower resale value
An old house comes at a lesser cost. But one has to discount the renovation cost before zeroing in on one. Used homes tend to deteriorate in overall condition and often require extensive repairs and refurbishing. They have far less resale value than new units, and no home loans are available on them after they have reached a certain age. This further reduces their marketability. They may have flawed titles and pre-existing litigation issues, since the transparency in property deals is only a recently emerging phenomenon in India, says Mr Kumar.
In the end, the choice of whether to go for an old or a new house is an individual decision. Some might want the best amenities and are also willing to pay for it. But if you feel that affordability is pinching you, old homes — (of course, those that have been constructed not more than 10 years ago) could be a good consideration. After all, you get it at a discounted rate — not to mention more space to boot.
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