What are the best Indices to trade for beginners?
- Dow Jones Industrials Average (US 30)
- Standard & Poor's 500 (S&P 500)
- Nasdaq (Composite and Nasdaq 100)
- Dow Jones Industrials (DJIA)
- UK FTSE 100 (FTSE 100)
- DAX (Germany 30)
- Euro Stoxx 50 (Euro 50)
Although indices are a popular term in financial news and analysis, many traders are still unsure of what they mean. We decided to share some information that will help you understand the true meaning of indices as trading instruments.
What exactly are indices?
How are they determined/calculated?
The majority of stock market indices are calculated using the market capitalization of the constituent companies. This method gives larger cap companies a higher weighting, implying that their performance has a greater impact on the value of an index than smaller cap companies.
What are the most actively traded indices?
- The S&P 500, Nasdaq 100 (NDX), and Dow Jones Futures are the three most traded indices in Grand Capital.The S&P500 index includes 500 of the most well-capitalized companies in the United States.
- Nasdaq 100 is a list of the top 100 most traded companies on the Nasdaq exchange.
- Finally, Dow Jones Futures is a derivative that allows traders to speculate on the value of stocks in the future.When trading indices with CFDs, you have the option of going long or short. Going long means entering a position with the expectation of a price increase. Selling short implies that you believe the price will fall.
