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INDEX
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An index is used by a stock exchange as a representative of the stock market as a whole. The index comprises of a large number of companies which are leaders from different industries representing the economy. The weightage of each company in the index is usually based on the market capitalisation of the company. The value of the index is arrived at using the market prices of the stocks comprising the index.

Related Terms: Sensex, Nifty, Market Capitalisation, Market Cap
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