What PSX indices are
A stock index tracks the combined price movement of a group of listed shares. The Pakistan Stock Exchange (PSX) calculates several PSX indices. Each has its own rulebook that sets which companies get in, how much weight each one has, and how often the list is reviewed.
The best-known PSX index is the KSE-100. This page covers three others that traders and investors in Pakistan often follow:
- “KSE-30”: a narrower index of large, actively traded companies.
- “KMI-30”: a Shariah-compliant index of large, liquid companies.
- KMI All Share Index: a broad index of all listed companies that pass the Shariah screening.
If you are new to the exchange, start with PSX basics and PSX explained.
Ready to try it on a real or demo account?
Partner link · trading carries a high risk of loss
“KSE-30” methodology
The “KSE-30” tracks a smaller group of the largest and most tradable companies on PSX. It is built on two main ideas.
Free-float weighting. Free float is the part of a company's shares that is available for trading. It excludes blocks held by sponsors, governments and other strategic holders. A company's weight depends on its free-float market capitalisation (free-float shares multiplied by price), not its total market capitalisation. A company that is large on paper but has few shares in public hands gets a smaller weight.
Selection by size and liquidity. Companies are ranked by free-float market capitalisation and screened for trading activity. Shares that trade rarely are not selected, even if the company is large.
The rules also include:
- Periodic recomposition. PSX reviews the constituent list on a schedule and can replace companies that no longer meet the criteria.
- Weight caps. These stop a single company from dominating the index.
- Corporate action adjustments. Bonus issues, rights issues and similar events are adjusted for, so they do not create artificial jumps in the index level.
Because the index is concentrated in large, liquid names, it can move differently from the broader KSE-100 on some days.
“KMI-30” methodology and Shariah screening
The “KMI-30” (KMI stands for KSE Meezan Index) tracks large, liquid companies that pass Shariah screening. PSX developed it together with Al Meezan Investment Management. Constituents are weighted by free-float market capitalisation, with recomposition and weight caps similar in principle to the “KSE-30”.
Shariah screening has two stages.
Business screening
The company's core business must be permissible. Companies whose main activity is excluded under Islamic finance principles are filtered out. Common examples are:
- conventional interest-based banking
- conventional insurance
- alcohol, pork-related products and similar prohibited goods
Financial screening
A company that passes the business test must also pass ratio tests based on its financial statements. These usually check:
- Interest-bearing debt compared with total assets
- Non-compliant investments compared with total assets
- Non-compliant income compared with total revenue
- Illiquid assets compared with total assets
- Net liquid assets per share compared with the share price
Each ratio has a threshold set in the official methodology. Thresholds can be revised, so check the current figures in the KMI rulebook on the PSX website. Do not rely on figures repeated on forums or social media.
From the companies that pass both stages, the larger and more liquid ones are selected for the “KMI-30”. A company can drop out at the next review if its business or ratios change.
For the wider subject, see Islamic finance.
KMI All Share Index
The KMI All Share Index uses the same Shariah screening but does not limit itself to the largest names. It aims to include all listed companies that pass the screening.
How it differs from the “KMI-30”:
| Feature | “KMI-30” | KMI All Share Index |
|---|---|---|
| Coverage | Large, liquid Shariah-compliant companies | All Shariah-compliant listed companies |
| Shariah screening | Yes | Yes |
| Liquidity filter for selection | Yes | Not the main selection rule |
| Typical use | Benchmark for large-cap Islamic equity | Broad view of the Shariah-compliant market |
Check the current weighting and review rules on the PSX website.
The list of “KMI-30” companies and KMI All Share constituents changes after each review. PSX publishes the current constituents and weights.
How these indices are used
- Benchmarks. Some mutual funds and exchange-traded funds compare their performance with these indices. A fund's offering document states its benchmark.
- Market reading. Comparing the “KSE-30” with the “KMI-30” shows how large conventional and Shariah-compliant names are moving relative to each other.
- Screening idea lists. Investors who want only Shariah-compliant shares often start from the KMI constituent lists.
An index cannot be bought directly. You can buy the individual shares or a fund that tracks or benchmarks the index. In Pakistan, trading in listed securities is done through brokers regulated by the Securities and Exchange Commission of Pakistan (SECP), with trading in listed securities and commodities only via SECP-licensed securities and futures brokers. Note also that per the SECP, lists of licensed brokers are on the PSX and PMEX websites. To set up access, see open a trading account.
Share prices and index levels can fall as well as rise, and past index performance says nothing certain about the future. Read risk management before you put money into equities. For trading hours and price limits, see hours and limits. For tax on gains, see capital gains tax.
Where to check the official rules
Methodology, thresholds, constituent lists and review schedules come from PSX. Before you rely on any detail, open the current index rulebook and constituent list on the official PSX website and note the date you checked it. For questions about regulators and licensing, see law and regulators.
Frequent questions
What is the difference between “KSE-30” and “KMI-30”?
Both track large, liquid companies weighted by free float. The “KMI-30” adds Shariah screening, so companies with non-permissible businesses or ratios outside the limits are excluded.
Is the KMI All Share Index the same as the “KMI-30”?
No. Both use the same Shariah screening. The KMI All Share Index covers all compliant listed companies, while the “KMI-30” selects only the larger, more liquid ones.
Where can I find the current “KMI-30” companies?
PSX publishes the current constituents and weights on its official website. The list changes at each recomposition.
Can a company leave the “KMI-30”?
Yes. If its business changes or its financial ratios move outside the thresholds, it can be removed at the next review.
Does inclusion in an index mean a share is safe?
No. Inclusion reflects size, liquidity and, for the KMI indices, Shariah screening. It says nothing about future returns, and the share can still lose value.
What does free float mean?
Free float is the portion of a company's shares available for public trading, excluding sponsor and strategic holdings. See the trading glossary for more terms.