6. What is a stock market index?

In the previous video, we discussed how a trading platform works to buy & sell stocks. Now, zooming out, you might have heard people say that the market is up or down on a particular day, but how did they make that judgement? This is where stock indices like the Nifty 50, Nifty Midcap 100, and Nifty Smallcap 100 come into the picture. There are various types of indices, but the most popular indices tend to the broad market indices like Nifty 50 and Sensex 30. They contain the biggest stocks listed on NSE and BSE. By looking at their performance, you can broadly get an idea about how the market have moved. In this video, we understand what an index is, how it is built and it's users. Learn more about stock indices: zerodha.com/varsity/chapter/the-stock-markets-inde…