KSE BRIndex30
BRIndex30 or BR Index 30 is a turnover based index for Pakistan Stock Exchange developed by Business Recorder. It can be followed on www.khistocks.com BR in BRIndex30 stands for (Business Recorder) and number 30 indicates the number of companies covered by the index. Companies are added or removed from the index based on average turnover or trading volume of their shares in the last six months since last revision of index composition.
Selection Criteria
Companies are selected on the basis of their trading volume and trading frequency.
Trading Volume/Turnover
BRIndex30 is a turnover based index and the average turnover of the scrip in the last six months is the primary criteria for scrip selection. First 30 scrips having the highest average turnover or trading volume in the last six months are considered for inclusion in the BRIndex30 given that they also meet the criteria for trading frequency.
Trading Frequency
It is necessary for a scrip to be traded on each and every trading day of the last 1 year; besides fulfilling the turnover criteria, to get included in the BRIndex30. (Exceptions can be made for extreme reasons).
Calculation
BRIndex30 is calculated using a “Market Capitalization Weighted” methodology. As per this methodology the level of index at any point of time reflects the total market value of 30 component stocks relative to a base period. The formula for calculating BRIndex30 is:
where P is the price of each stock in the index and Q is the number of CDC shares publicly available for each stock.
The divisor is adjusted in the case of price change due to cash dividend, stock dividend, right shares issue or stock splits to ensure that such events do not in themselves alter the numerical value of the Index.
Revision Frequency
BRIndex30 company composition is revised every six months while CDC shares of companies are revised every 3 months to reflect precise market situation.