Indices
Trade Indices
Access major global indices and track market movements with diversified trading opportunities.
What are Indices?
Indices are an asset class that is quite popular among traders. An index is a collection of assets that gives traders an average price to look at, making it easier to follow the price movements of a market or an industry. Stock indices are the most common and can combine stocks based on company size, industry, or other characteristics. Each country has one or more indices, with major economies having "benchmark indices" that combine the largest or most important companies.
Market Overview
Track entire markets with single instruments and get exposure to broad economic trends across different regions and sectors.
Popular Indices
Trade the world's most recognized benchmark indices from major financial centers.
US Indices
The world's largest and most liquid equity markets:
- S&P 500: Benchmark index of 500 largest US companies
- NASDAQ 100: Technology-focused index
- Dow Jones 30: Price-weighted index of 30 major companies
European Indices
Major European markets representing diverse economies:
- FTSE 100 (UK): Multi-national companies
- DAX 30 (Germany): German blue-chip stocks
- CAC 40 (France): French market leaders
Asian Indices
Dynamic Asian markets with strong growth potential:
- Nikkei 225 (Japan): Japanese stock market
- Hang Seng (Hong Kong): Hong Kong market
- S&P/ASX 200 (Australia): Australian market
Index Price Effects
Changes in index values are normal and affected by the prices of underlying stocks. Indices can be calculated in different ways, creating interesting fluctuations and trading opportunities.
Market Capitalization Weighted
Larger companies have more influence on the index movement, providing stability and representing market reality.
Price Weighted
Higher-priced stocks have greater impact (like the Dow Jones Industrial Average), creating unique trading dynamics.
Benefits of Index Trading
Discover why many traders prefer indices over individual stocks.
Reduced Risk
Diversity of the index reduces risk and helps smooth out returns in the long run through natural diversification.
Money Management
Diversity provides built-in money management by not putting all funds in one stock, spreading risk across multiple companies.
Predictable Patterns
Indices have personalities that experienced traders can read well, with less volatile moves compared to individual stocks.
Disadvantages of Index Trading
Just as leverage increases the potential gains in any index CFD trade, it also increases the potential losses. This makes leverage a double-edged sword and both a benefit and a disadvantage when not used properly.
Another disadvantage often not considered is the amount of research and knowledge required to successfully predict index movements. The markets are very complex and it isn't unusual for traders to get caught by geopolitical risks they hadn't considered.
Ready to Trade Indices?
Access global market indices with Capitalvo's comprehensive trading platform.