What Are Indices?
Trading indices (or stock indices) are measurements of the value of a group of stocks from a particular exchange, sector, or region. Rather than trading individual stocks, traders can speculate on the overall performance of a market via these indices.
Popular Global Indices
INDEX | REGION | DESCRIPTION |
|---|---|---|
How Index Trading Works?
CFDs (Contracts for Difference): Most popular method; allows speculation without owning assets.
Futures: Agreements to buy/sell at a future date and price.
ETFs: Exchange-Traded Funds that mirror an index.
Options: Contracts offering the right (not obligation) to buy/sell the index.
Why Trade Indices?
Diversification: Exposure to a whole market, not just one stock.
Liquidity: High volume and tight spreads in major indices.
Volatility: Frequent price movements = opportunities for profit.
Market Insight: Reflects broader economic sentiment.
Risks
Market volatility
Leverage amplifying losses
Geopolitical and economic events affecting indices