Learn · Track 2: How the PSX works · lesson 5 of 9 · Beginner
What is the KSE-100 index? How it works in 2026
The KSE-100 is PSX's benchmark of 100 free-float-weighted companies, base 1,000 in 1991. It closed at 167,089 on 9 Oct 2026, up 2.45% in a year.
By the SuperX research team · Reviewed by Umair Aslam, Co-founder & CEO · Updated
The KSE-100 index (KSE-100 kya hai, in Roman Urdu) is the main benchmark of the Pakistan Stock Exchange (PSX). It tracks 100 listed companies, weighted by their free-float market capitalisation, that is, the value of the shares actually available to trade. Thirty-six places go to the largest company in each PSX sector and 64 to the next-largest companies overall. The index started in November 1991 at 1,000 points and is recomposed twice a year. It closed at 167,089.27 on 9 October 2026, up 2.45% over one year and 11.7% below its record close of 189,166.83 on 23 January 2026. You cannot buy the index itself, but exchange-traded funds on PSX hold baskets drawn from its stocks.
How is the KSE-100 calculated?
PSX adds up the free-float market capitalisation of the 100 member companies and divides the total by a number called the index divisor. A company’s free-float market capitalisation is its share price multiplied by its free-float shares: the shares in public hands, after deducting those held by the government, directors and sponsors, group companies, shares still in physical form, employee-scheme shares that cannot be sold and treasury shares. The calculation updates through the trading day as trades happen.
The divisor is the only link back to the 1991 base. PSX adjusts it for corporate actions and for companies entering or leaving, so the index does not jump just because a company paid a bonus or was replaced. The rules are in PSX’s KSE-100 index brochure (updated June 2025), which this post follows.
One detail that surprises many readers: PSX describes the headline KSE-100 as a total return index, meaning cash dividends are adjusted for in its constituents. A separate KSE100PR index is the price-return version, which does not adjust for gross cash dividends. As of 9 October 2026, the one-year return was +2.45% for the KSE-100 and -3.27% for the KSE100PR. The gap of about 5.7 percentage points is the dividend effect over that year.
Which 100 companies are in it? The sector rule
The brochure sets two selection steps:
- One company from each sector. The company with the largest free-float market capitalisation in each of the 36 PSX sectors is included. The open-end mutual fund and exchange-traded fund sectors are excluded.
- The rest by size. The remaining places, currently 64, go to the largest free-float market capitalisations in descending order.
Together the 100 companies capture roughly 70% to 80% of the total free-float market capitalisation of the exchange, according to PSX. A company on the Defaulters’ Counter, or one that was suspended or declared non-tradable in the preceding six months, is not considered. A newly listed company can enter after one recomposition period if its free-float market cap is at least 2% of the total.
The sector rule is why small sectors are present: a modest-sized company can be in the index because it is the largest in its sector, not because it is among the largest overall. It also explains why the weight of each sector in the index is far from equal.
How often is the KSE-100 rebalanced?
Twice a year. PSX recomposes the index on a semi-annual cycle:
| Data cut-off | Notice | Effective |
|---|---|---|
| Last working day of February | 15 March | First working day of April |
| Last working day of August | 15 September | First working day of October |
Two rules govern entry and exit. A company outside the index replaces the sector’s incumbent if it is the largest in its sector for two recomposition periods in a row, or at once if its free-float market cap is at least 10% above the incumbent’s. For overall size, an outside company must beat the smallest size-based member for two consecutive periods. PSX can also hold a special recomposition after events such as a merger or delisting.
The most recent change was announced on 15 September 2026 (PSX notice N-1128) and took effect on 1 October 2026. Image Pakistan, Thatta Cement, Nishat Chunian Power and Bank Makramah came in; Hum Network, Mehmood Textile Mills, Pakistan Aluminium Beverage Cans and Rafhan Maize Products went out.
What is the KSE-100 level now, and what is the record high?
Figures from the SuperX market snapshot, as of the 9 October 2026 close:
| Measure | Value |
|---|---|
| Closing level | 167,089.27 |
| Base | 1,000 in November 1991 (about 167 times the base) |
| One-year return (10 Oct 2025 to 9 Oct 2026) | +2.45% |
| Record close | 189,166.83 on 23 January 2026 |
| Distance below the record close | 11.7% |
| KSE100PR (price return) one-year return | -3.27% |
The record close of about 189,167 on 23 January 2026 matches press reports of that day, which also gave an intraday high of 189,566.64. This post uses closing levels. The figures are fixed to 9 October 2026 and will have moved; the live level is on the KSE-100 page.
How does it differ from the KSE-30, KMI-30 and All Share?
| Index | What it covers | Method | Level, 9 Oct 2026 | One-year return |
|---|---|---|---|---|
| KSE-100 | 100 companies chosen by sector leadership and size | Free-float market cap | 167,089.27 | +2.45% |
| KSE-30 | The 30 most liquid companies | Free-float market cap | 49,841.70 | -0.68% |
| KMI-30 | The 30 most liquid Shariah-compliant companies | Free-float, individual weight capped at 12% | 240,372.43 | +0.86% |
| All Share (ALLSHR) | Every listed company | Full market cap | 101,117.39 | +1.85% |
The descriptions come from PSX’s indices page. The KSE-100 is the broadest of the free-float benchmarks. The KSE-30 is a narrower cut. The KMI-30 excludes conventional banks, so a halal-only portfolio should be measured against it. The All Share counts every company by full market value, so large, closely held companies weigh more than they do in the KSE-100. KSE-100 vs KMI-30 vs KSE-30 sets out how to choose the benchmark that matches what you own.
Which companies and sectors move the index?
Because weights follow free-float market cap, a few names dominate. As of 9 October 2026, the ten largest members carried 49.4% of the index. Fauji Fertilizer (8.97%), United Bank (7.75%), Meezan Bank (5.23%) and Engro Holdings (5.05%) were the four largest weights. By sector, the 14 commercial banks in the index carried 30.8% of the weight, the four oil and gas exploration companies 12.7%, the four fertiliser companies 12.5% and the ten cement companies 8.8%. When the KSE-100 moves 1%, it is mostly banks, energy and fertiliser moving. KSE-100 heavyweights: what actually moves the index breaks the weights down, and market cap vs share price explains why size, not price, sets a weight.
Can you invest in the KSE-100?
Not directly. An index is a number, not a security. To get exposure you have two routes:
- Buy the constituents yourself. Weights follow free-float market cap, so a copy of the index is a large basket.
- Buy an exchange-traded fund (ETF) listed on PSX. PSX’s own pages describe nine ETFs listed on the exchange. They trade like shares through a broker, as covered in how to invest in PSX.
The two oldest ETFs draw their holdings from KSE-100 stocks. NIT Pakistan Gateway ETF (NITGETF) tracks the NIT Pakistan Gateway Index, made of the largest KSE-100 stocks so that they cover at least 50% of the KSE-100’s free-float market capitalisation. UBL Pakistan Enterprise ETF (UBLPETF) tracks the UBL PSX Pakistan Enterprise (UPP9) Index, the nine largest KSE-100 companies by free float, excluding oil and gas. The others listed in SuperX’s data are Meezan Pakistan ETF (MZNPETF), Mahaana Islamic Index ETF (MIIETF), NBP Pakistan Growth ETF (NBPGETF), Alfalah Consumer Index ETF (ACIETF), JS Momentum Factor ETF (JSMFETF), JS Global Banking Sector ETF (JSGBETF) and HBL Total Treasury ETF (HBLTETF), each following its own index or strategy.
None of these is a pure KSE-100 tracker, as far as PSX’s pages show, so an ETF’s return will differ from the index’s. Check each fund’s index, fees and tracking record in its offering documents before comparing.
What are common misconceptions about the KSE-100?
- “The KSE-100 is up, so my shares are up.” Only if you hold the heavyweights. Small companies move on their own.
- “It measures the Pakistan economy.” It measures listed companies, and it leans toward banks, energy, fertiliser and cement.
- “A high level means expensive.” The level reflects 35 years of compounding from a base of 1,000, not valuation.
- “Past returns predict the next year.” One-year returns of the index have varied widely; use it as a benchmark, not a forecast.
Frequently asked questions
What is the KSE-100 index?
It is the Pakistan Stock Exchange’s benchmark of 100 companies, weighted by free-float market capitalisation, with a base of 1,000 points in November 1991. It closed at 167,089.27 on 9 October 2026.
How many companies are in the KSE-100 and how are they chosen?
There are 100. The largest company in each of 36 sectors is included, and the other 64 places go to the next-largest by free-float market capitalisation. PSX recomposes the list twice a year.
What is the KSE-100 record high?
The record close was 189,166.83 on 23 January 2026. On 9 October 2026 the index was 11.7% below it.
What is the difference between the KSE-100 and the KSE-30?
The KSE-30 holds only the 30 most liquid companies, while the KSE-100 holds 100 chosen by sector and size. The KSE-100’s one-year return was +2.45% against -0.68% for the KSE-30 on 9 October 2026.
Can I buy the KSE-100 through an ETF?
PSX lists nine ETFs, but none is a pure KSE-100 tracker as far as its pages show. Two track baskets of the largest KSE-100 stocks: NITGETF and UBLPETF.
See today’s level, return and constituents on SuperX’s KSE-100 page.
Education, not investment advice.
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