Stock Exchange is one the most essential constituent of capital market or business sector. Stock Exchange is a well-organized market and business sector for the buying and offering of modern and money related securities.
The Karachi stock exchange -100 index was created in November 1991 with base estimation of 1,000 points. The index involves 100 companies out of all recorded or listed organizations at present at 559. “Those 100 are chosen on the premise of sector representation and highest market capitalization, which tracks more than 85pc of the market capitalization of the firm’s listed on the Exchange.” The two sectors that have the highest weightage in the index include commercial banks with 25pc weight and oil and gas investigation firm’s having 10pc weight. Together, they are 35pc of the Karachi Stock Exchange-100 index. The thought behind creation of stock markets is to permit individuals to invest/disinvest within organizations/industrial sectors.
The Karachi Stock Exchange (KSE) is the leading stock market of the country. It provides a liquid and proficient digitized commercial center where financial specialists or investors meet directly to purchase and offer listed firm’s common stock and different securities
The most essential goal and objectives of the Karachi Stock Exchange-100 index are to have a benchmark by which the stock price execution can be compared with over a time frame. Specifically, it is intended to provide speculators with a feeling of how the Pakistan equity market is performing. In this way, it is similar to other and different indicators that track different areas of the Pakistan monetary and economic growth, for example, the gross national product, consumer price index, and so forth.
The Karachi Stock Exchange and its Trading System has acquainted modernized or computerized exchanging framework or trading system which give a reasonable, straightforward, productive and efficient and cost effective market instrument to encourage the speculators.
Importance of Karachi stock exchange for investors
Stock exchanges are so important for investors because they provide a meeting point to all speculators and investors. We put resources into a stock or invest in it because we think the organization and firm can put our assets or funds to better use than we can and consequently generate better returns on our investment. On the other side, there are many people with brilliant ideas but not enough resources. So we can say that stock exchange provides a better chance and platform where an individual or investor can invest with minimum resources and get profitable returns on their investment.
However, stock exchanges are useful for international investors as well, particularly given they are supported by government laws and are for the most part not benefit looking for, so it makes them safe to exchange with.
People do invest in stock exchanges because liquidity is very easily available in the stock market. For example: if you want to convert your investment into cash than you can do that very easily in the stock markets.