Asia Index Private Ltd., a fully owned subsidiary of the Bombay Stock Exchange (BSE), has recently made waves in the financial market by launching three innovative indices: the BSE SENSEX Sixty 65:35, the BSE SENSEX Sixty, and the BSE Power and Energy Index. These new indices are designed to enhance the investment landscape for both individual investors and asset managers, demonstrating BSE’s commitment to addressing the evolving needs of its clientele.
Understanding the New Indices
The introduction of these indices is a strategic step toward expanding the product offerings available at BSE, fulfilling the vision of providing meaningful and relevant financial instruments. According to Ashutosh Singh, MD and CEO of Asia Index Pvt Limited, this initiative reflects the philosophy of listening to the “Voice of Customer” to deliver products that resonate with their investment strategies.
BSE SENSEX Sixty 65:35
BSE SENSEX Sixty 65:35 is a unique strategy index that includes components from both the BSE SENSEX and the BSE SENSEX Next 30, allocated in a ratio of 65:35. This composition gives investors greater exposure to the Next 30 constituents, which represent over 55% of the total free float market capitalization in India. The tailored blend in this ratio aims to optimize returns while diversifying risk.
BSE SENSEX Sixty
The BSE SENSEX Sixty serves as a broader index that features the constituents of the BSE SENSEX alongside the BSE SENSEX Next 30, ranked by their free float market capitalization. This index provides a more comprehensive overview of market performance and is particularly beneficial for investors seeking to gauge the broader trends within the Indian equity market.
BSE Power and Energy Index
On the thematic front, the BSE Power and Energy Index focuses on the performance of companies operating within the Energy and Utility sectors, specifically those listed in the BSE 500. This index reflects the weighted performance of these constituents and serves as a valuable gauge for assessing trends in the energy market, which is critical as global economies transition towards sustainable energy sources.
Key Features of the Indices
| Index Name | Base Value | First Value Date | Reconstitution Frequency | Weighting Method |
|---|---|---|---|---|
| BSE SENSEX Sixty 65:35 | 10,000 | 23rd June 2014 | Semi-annually | Free float market capitalization (65:35 ratio) |
| BSE SENSEX Sixty | 10,000 | 23rd June 2014 | Semi-annually | Free float market capitalization |
| BSE Power and Energy Index | 1,000 | 31st December 2013 | Semi-annually | Free float market capitalization (capped at 15% per stock) |
Applications of the New Indices
These indices provide valuable benchmarks for a variety of investment strategies, including Portfolio Management Services (PMS), Mutual Fund (MF) schemes, and overall portfolio assessments. Furthermore, they are suitable for implementing passive investment strategies like Exchange-Traded Funds (ETFs) and Index Funds, allowing investors to effectively gauge the performance of sectors represented by these indices. By introducing these new offerings, BSE is enhancing access to diverse market opportunities, enriching the investment strategies of both institutional and retail investors.
About Asia Index Private Ltd
Asia Index Private Ltd is a wholly owned subsidiary of BSE Ltd, which stands as Asia’s oldest stock exchange and the founder of the SENSEX index—an essential barometer of Indian equity market performance. Asia Index Pvt. Ltd’s mission is to provide a comprehensive range of indices to both global and domestic investors, facilitating informed investment decisions through the calculation, publication, and maintenance of a diverse family of indices.
