NSE 25 Share Index: What It Measures and How It Is Built

Direct Answer

The NSE 25 Share Index is a rule-based measurement of top 25 companies listed on the Nairobi Securities Exchange by market activity, maintained by Nairobi Securities Exchange. Like every index it owns nothing: it is a number produced by applying a published weighting formula to a selected list of companies, revised on a schedule the provider sets.

What this index covers

The NSE 25 Share Index covers top 25 companies listed on the Nairobi Securities Exchange by market activity, within the Kenya market. Nairobi Securities Exchange defines which securities are eligible, how they are selected from that pool, and how much each one contributes to the published number.

The name states a target of 25 companies. A target is not a guarantee of the exact count on any given day: corporate actions, dual share classes and pending additions all move the real number around it.

How constituents are weighted

Capitalisation based: volume weighted average price times tradable shares in issue times an investability factor (the free float percentage) times a capping factor, divided by a divisor that absorbs capital changes. Prices carry forward from the prior day when a stock does not trade.

The weighting method is the single biggest driver of how an index behaves. Two indexes covering the same market can diverge for years purely because they weight differently, which is why comparing index levels without knowing the method tells you very little.

What qualifies for inclusion

At least 20% of shares quoted on the NSE, a minimum market capitalisation of KES 1 billion, and ideally a blue chip company with a superior profit and dividend record.

Eligibility rules are the part of an index most readers never look at and the part that decides what it can possibly measure. A screen that excludes a whole sector, or admits only one listing venue, shapes the result far more than any day of trading does.

How long a listing must exist first

A company must have been continuously quoted on the NSE for at least one year.

A seasoning rule is why a large new listing does not appear in an index the week it starts trading. It is a deliberate lag, and it means an index can under-represent a fast-growing part of the market for months at a time.

When the membership is revised

The Trading Committee reviews constituents semi-annually. Securities are scored on market capitalisation (40%), shares traded (30%), deals (20%) and turnover (10%) and ranked by market capitalisation; existing constituents that fall out of the top 25 qualify for removal, with a published reserve list of the highest ranked non-members.

Reconstitution is the one date an index changes shape by design rather than by price. Funds tracking it have to trade toward the new membership, which is why the schedule matters to anyone holding the tracker rather than only to the provider.

The rule that surprises people

The minimum market capitalisation for the index is KES 1 billion.

References

• Nairobi Securities Exchange: Nairobi Securities Exchange, Ground Rules for Generation of NSE 25 Share Index v1.4, as published 2025. Every rule described on this page is taken from this document.

Current NSE 25 Share Index constituents

Nairobi Securities Exchange publishes and licenses the NSE 25 Share Index constituent list. Swoopr does not republish it here. The provider's own page is the authoritative source for current membership and weights.

Nairobi Securities Exchange: official NSE 25 Share Index page

Related reading

• All stock market indexes: how indexes are built, weighted and revised.
• Emerging Markets indexes: others covering the same region.
• Index concentration: measuring how much of an index sits in its largest holdings.
• Index rebalancing and inclusion effects: what happens to a stock when index membership changes.

Frequently Asked Questions