How is NEPSE Index Calculated?

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The calculation of the NEPSE index is based on the concept of the market capitalization (sum of the market capitalization of all the listed in the Nepal Exchange). If the ratio of current period market capitalization to the base period market capitalization is multiplied by the multiplier 100, we get the index. This method of index calculation is the -weighted method. This concept can be illustrated a hypothetical example, considering ‘0’ as the base period ‘1’ as the current period as follows:

How is NEPSE Index Calculated?

M.C. = Market Capitalization.
O. S. = Outstanding

NEPSE Index = (Total Market Capitalization of all the Companies Listed/Total Base Year’s Market Capitalization) *100
NEPSE Index = (187500/157)* 100
NEPSE Index for the time period ‘1’ is 119.43 with reference to the base period ‘0’.

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