CAC 40 Index
The CAC 40 Index is a France Stock Market Index that tracks the performance of the top 40 largest stocks in the Euronext Paris Bourse. This index tracks the capitalization of the top 40 stocks included.
The CAC 40 Index Chart
The CAC 40 Index chart is shown above. On the example above this Index is named as FRA40CASH. As a trader you want to find a broker that provides this The CAC 40 Index chart so that you can start to trade it. The stock index example above is of CAC 40 Index on the MetaTrader 4 Forex and Stock Indices Trading Platform.
Other Information about CAC 40 Index
Official Symbol – CAC:IND
The 40 component stocks that make up the CAC 40 Index are picked from the top companies in France. The Index calculation is reviewed quarterly.
Strategy for Trading CAC 40 Index
The CAC 40 Index tracks the capitalization of the top 40 companies in France. This index generally moves up over the long term because the French economy also shows strong growth.
As a trader you want to be biased and keep buying as the index moves up. When the French economy is doing well most of these top stocks will continue to move up and therefore this index will also move in an upward trend. A good stock index trading strategy would be to keep buying the dips.
During Economic Slow Down and Recession
During economic slowdown and recession times, companies start to report lower profits and lower business growth prospects. It is due to this reason that investors start to sell stocks of companies reporting lower profits and therefore the stock index tracking these particular stocks will also start to move downwards.
Therefore, during these times stock index trends are likely to be heading downwards and as a trader you should also adjust your trading strategy accordingly to fit the prevailing downward trends of the stock market index that you are trading.
Contracts and Specifications
Margin Required Per 1 Lot - € 40
Value per 1 Pip - € 0.1
Note: Even though the general trend is generally upwards, as a trader you have to factor in the daily market volatility, on some days the stock index may oscillate or even retrace, the stock index market retracement may also be significant at times and therefore as a trader you need to time your entry precisely using this strategy: Stock indices trading strategy and at the same time use proper money management rules just in case of more unexpected volatility in the market trend. About money management rules in stock index trading topics: What is stock index money management and stock index money management methods.