Stock Indices

A stock index is a group of stocks that can be bought or sold as a single tradable instrument. Some traders think about how the price of a single asset changes, but others prefer speculating on stock indices. In general, stock indices can be used to represent the state of an industry or even a country.
But classifying stock indices is a bit more complex. Some indices, such as the DAX 40, represent the top 40 performing companies in Germany. Classified as a “national stock index,” it offers insight into the German equity market’s condition.
However, stock indices aren’t only made up of geographically grouped stocks. Some indices track performance of specific sectors. For example, the US Tech 100 index tracks performance of companies listed on Nasdaq. Typically these are tech firms, and the US Tech 100 offers insight into the U.S. tech sector!

Why trade stock indices?

Our goal is to help our traders succeed by offering an exceptional trading experience.

How to trade stock indices?

Since indices consist of multiple companies, there are various factors affecting the index’s price. Simply put, if the stocks within the index rise in price, the index will rise too, and vice versa. Traders speculating on indices decide whether the index will go up or down based on market sentiment.
Price movement of an index is likely to be smoother than some individual assets, since a single stock rarely moves the whole index drastically. But indices still exhibit volatility because they reflect broad economic or political shifts.
A trader may anticipate the index will rise. The stocks in the index increase in value, raising the index’s value. The trader profits.

Upcoming dividends on stock indices

The stocks comprising an index periodically pay dividends to shareholders. When this happens, it influences the index’s overall value, causing it to drop by a certain amount. We ensure there is no adverse impact to your account if you have an open position through dividend adjustment. We either credit (if you hold a long position) or debit (if you hold a short position) your trading account with the amount corresponding to the interim profit or loss caused by the dividend adjustment.