Trade Stock Indices

What's SP 500 Strategy? - Guide to Trading SP500 Index

SP500 Strategy - How to Trade SP500 Index

The SP500 Trade Chart

SP 500 chart is illustrated and displayed and portrayed above. On example put on display above this trading instrument is named as US500CASH. As a trader you want to find a broker that provides SP 500 chart so that as you as a trader can start to trade it. The index example shown above is that of SP 500 on MT4 Forex Software.

Strategy to Trading SP500 Index

SP 500 manner of calculating it makes it more volatile & hence there are wider swings in the price movement of this index. Although this index generally moves upwards over the long-term because US economy also shows strong and robust growth and is also the biggest economy in the globe.

As a trader wanting to trade this stock index, be prepared for wider price swing and a little more volatility.

As a index trader you want to be biased and keep on buying as the index moves and heads upwards. When US economy is performing well (majority of the times it's performing good) this upward trend is more likely to be ruling & in place. A good stock index trade strategy would be to buy dips.

During Economic Slow-Down and Recession

During economic slow down & recession periods, firms start reporting slower earnings and revenues, slower profits and lowers growth prospect. It is because of this reason that traders start to sell stocks of corporations that are recording and reporting lower profits and hence index tracking these particular stocks will also start to move downwards.

Hence, during these times stock index trends are likely to be heading and moviing downwards & as a trader you should also adjust your strategy accordingly to fit the prevailing downwards trends of the stock market index that you're trading.

Contracts & Details

Margin Requirement Per 1 Lot - $ 12

Value per 1 Pip(Point) - $0.1

NB: Even though general trend is in general moves upwards, as a stock indices trader you've got to factor in daily market volatility, on some days the index might move in a range or even pull-back, market retracement may also be significant some times and thence as the trader you need to time your entry precisely using this trading strategy: Stock Index trade strategy and at the same time use the proper/appropriate money management strategies and guidelines in case there's unexpected volatility in the market trend. About money management rules in index topics: What's index equity management & equity management methods.

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