Index Construction Methodology
Basis of index construction
Our proprietary, copyright protected index construction methodology is based on the Open Interest of active futures of index component companies.
Companies must meet the following criteria:
1. Trading History
Both, the future (any 1 or more live contracts) & underlying share of the component, should have been traded on each trading day in the preceding Calendar Quarter.
2. Open Interest
The average Open Interest value of the component’s futures should be among the top 55 among all companies traded in the preceding Calendar Quarter.
To ensure low impact cost, the total traded value of all index components’ futures & underlying should be atleast 2/3rd of the total traded value of all stocks traded in both, futures & cash segments in the preceding Calendar Quarter.
Index Computation Methodology
Weights in all Technidex Stock Futures Indexes© are identical, assigned to each index component based on its futures’ Open Interest value as a percentage of the Open Interest value of all index components’ futures. Market players decide components’ daily importance & weight in the index.
Adjusted Future Price & Expiry Date
Our proprietary, copyright protected index computation methodology calculates a single adjusted future price & adjusted expiry date for all future contracts for each index component.
Technidex Stock Futures Indexes© use the adjusted future price and the latest traded underlying price for computing the indexes at end of day from the derivatives & equity segments of the exchange.
Technidex Cost of Carry (CoC) Indicator© is based on adjusted expiry date & adjusted future price, ensuring a continuous & smooth price-line at all times without distorting or showing sharp spikes in the CoC close to expiry days.
Technidex Delivery Indicator© is based on the Delivery % of each index component in the underlying segment.