Germany DAX 30 Index
The DAX 30 represents Germany's Market Index of the top Blue Chip Stocks. This Index represents the Top 30 Most Liquid Stocks that trade on the Frankfurt Stock Exchange Market. Because Germany is the biggest economy in the Euro Zone, the DAX 30 Index is one of the most popular Index traded by investors.
Just like forex currencies, the Germany DAX 30 Index also has a chart representation and the chart can be traded and analyzed by traders. Traders can place a buy or sell order and trade this index using standard lots.
The Germany DAX 30 Index Chart
The Germany DAX 30 Index chart is shown above. On the example above this financial instrument is named as GER30CASH. As a trader you want to find a broker that provides this The Germany DAX 30 Index chart so that you can start to trade it. The stock index example above is of Germany DAX 30 Index on the MetaTrader 4 Forex and Stock Indices Trading Platform.
Other Information about Germany DAX 30 Index
Official Symbol – DAX:IND or GDAXI
The 30 component stocks that make up the Germany DAX 30 Index are revised a few times a year to determine if to change this composition or not. Stocks that are not performing well may be replaced with other stocks that are doing well.
Strategy for Trading Germany DAX 30 Index
The Germany DAX 30 Index is comprised of blue chip stocks that trade in the Frankfurt Stock Exchange picked from the best performing sectors in Germany; therefore a good strategy to trade the Germany DAX 30 Index is to trade long most of the times. This is because in general the best stocks in Frankfurt Stock Exchange will generally keep moving up and up because the companies behind these stocks are the best and most profitable companies in Germany.
The Germany DAX 30 Index is also revised a few times every year so that if one stock is not doing well then it is replaced with another blue chip stock that is doing good. This ensures that most of the times the Germany DAX 30 Index will keep going up.
As a trader you want to be biased and keep buying as the index moves up. When the German economy is doing well (most of the times it is doing well) this upward trend is more likely to be ruling. A good stock index trading strategy would be to buy 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 - € 85
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.
