Trade Stock Indices

Learn Stock Indices Trading

Lots and Contracts in Trading Stock Indices

Stock indices are traded in lots; these lots are made up of a number of units of a particular stock index.

 

For example the 1 lot of AUS200Cash Index is made up of AUD 7,000 and for this 1 lot one point movement in the stock index value is equal to AUD 0.1; However with leverage of 100:1 a trader only needs AUD 70 as their margin or capital so as to open 1 lot of AUS200Cash Index.

 

Leverage for those who do not know is trading on borrowed capital while using very little of your own capital as security. For example leverage 100:1 means that a trader borrows $100 dollars for every $1 dollar of their own. Therefore if a trader has $10,000 dollars and uses leverage 100:1, meaning that the trader now borrows $100 dollars for every $1 dollar that they have - they will now have control of $1,000,000 total capital to invest - that is $10,000*100= $1,000,000. This leverage is what makes stock indices attractive to most online traders as traders obtain more capital to invest with once they employ leverage.

 

The leverage for each of the 14 indices is shown below along with the margin requirements and profit per 1 point movement in the stock indices instruments.

 

Specifications of Stock Indices

The specifications of the stock indices provided for trading are shown below:

 

Australia ASX 200

Symbol - AUS200Cash

Pip (1 Point) - 0.1

Pip Value - AUD 0.1

1 Lot Units - AUD 7,000

Margin per Lot - AUD 70

 

EU EURO STOXX

Symbol - EU50Cash

Pip (1 Point) - 0.1

Pip Value - EUR 0.1

1 Lot Units - EUR 4,000

Margin per Lot - EUR 40

 

France CAC 40

Symbol - FRA40Cash

Pip (1 Point) - 0.1

Pip Value - EUR 0.1

1 Lot Units - EUR 4,000

Margin per Lot - EUR 40

 

Germany DAX 30

Symbol - GER30Cash

Pip (1 Point) - 0.1

Pip Value - EUR 0.1

1 Lot Units - EUR 8,500

Margin per Lot - EUR 85

 

Hong Kong Hang Seng 50

Symbol - HK50Cash

Pip (1 Point) - 1

Pip Value - HKD 1

1 Lot Units - HKD 45,000

Margin per Lot - HKD 450

 

Italy FTSE MIB 40

Symbol - IT40Cash

Pip (1 Point) - 1

Pip Value - EUR 1

1 Lot Units - EUR 4,000

Margin per Lot - EUR 250

 

Japan Nikkei 225

Symbol - JP225Cash

Pip (1 Point) - 1

Pip Value - JPY 1

1 Lot Units - JPY 9,000

Margin per Lot - JPY 90

 

Netherlands AEX 25

Symbol - NETH25Cash

Pip (1 Point) - 0.1

Pip Value - EUR 0.1

1 Lot Units - EUR 500

Margin per Lot - EUR 5

 

Spain IBEX 35

Symbol - SPAIN35Cash

Pip (1 Point) - 1

Pip Value - EUR 1

1 Lot Units - EUR 14,000

Margin per Lot - EUR 140

 

Switzerland SMI 20

Symbol - SWI20Cash

Pip (1 Point) - 0.5

Pip Value - CHF 0.5

1 Lot Units - CHF 10,000

Margin per Lot - CHF 100

 

UK FTSE 100

Symbol - UK100Cash

Pip (1 Point) - 0.1

Pip Value - GBP 0.1

1 Lot Units - GBP 7,000

Margin per Lot - GBP 70

 

USA S&5 500

Symbol - US100Cash

Pip (1 Point) - 0.1

Pip Value - $ 0.1

1 Lot Units - $3,000

Margin per Lot - $30

 

USA NASDAQ 100

Symbol - US30Cash

Pip (1 Point) - 0.5

Pip Value - $ 0.5

1 Lot Units - $15,000

Margin per Lot - $150

 

USA DJIA 30

Symbol - US500Cash

Pip (1 Point) - 0.1

Pip Value - $ 0.1

1 Lot Units - $1,200

Margin per Lot - $12

 

Please note these instruments are quoted in 5 decimal points and therefore when trading note that the last point represents a fraction of a point.

For example if GER30 is quoted at 11645.20, the last point represents a fraction of a point, the point in this case is the digit 2, and because for GER30 1 Point equals EUR 0.1 to make profit of EUR 1, the price will have to move 10 points that is 11646.20.

 

The margin is the amount of capital that you will put down so as to transact one lot of that financial instrument.

 

Each stock index is based on a different currency; therefore there is no standard lot for these stock indices. In addition the profit from each stock index is calculated in the currency of the economy that it represents - therefore you have to factor the exchange rate in relation to the dollar when calculating the profits.

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