The indicator calculated on the basis of a specific basket of shares is called a stock index. It is necessary to understand exactly which securities form each indicator. By using the same tools that are utilized in calculating the indicator, the trader can form a more accurate prediction. The stock index is a powerful indicator that shows the overall trends and rates of change in the market share prices of a specific sector of the economy. For example, an increase in oil prices is likely to lead to an increase in the value of assets of oil producing companies.
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How does CFDs on Indices trading work?
Being a set of influential companies compounded by stock, indices are usually hardly accessible. Still, with DB Investing, you can get a shortcut to indices trading by using CFDs.
There is no need to be directly involved in the market. Choose cross-platform trading, 60+ analytical tools, and quick connection during the market hours with DB Investing.
Why trade CFDs on indices with DB Investing ?
There are over 2000 different stock indices. They are divided into micro and macroeconomic indices. The first shows the market situation in a particular industry or region. Macroeconomic indices show a general trend in the economy. Both are used to analyze the market and form sound investment strategies.
Stock indices can also be internal or external. In the first case we are talking about companies operating under the jurisdiction of one country. External indices combine data on international assets. Investors track both types of indicators.
The most well-known stock indices:
Dow Jones – one of the first indices. It is the mathematical mean value of the shares of the 30 largest American companies.
S&P 500 – an index reflecting the total capitalization of 500 large American companies listed on the stock exchange.
NASDAQ – the indicator reflects the total capitalization of companies registered on the same stock exchange. This index is comprised of companies that operate in the sphere of technology.
NYSE – this index is calculated based on the level of capitalization of all companies (not only American) whose shares are traded on the New York Stock Exchange.