Germany DAX30 Stock Index
The DAX30 represents Germany's Market Index of top Blue Chip Stocks. This Stock Index represents Top 30 Most Liquid Stocks which are traded in Frankfurt Stocks Market. Because Germany is the largest economy in Euro Zone, the DAX30 Stock Index is one of the most popular Index traded by investors.
Just like currencies, the Germany DAX30 Stock Index also has a chart representation & the chart can be traded and analyzed by traders. Traders can place a buy or sell order & trade this stock index using standard lots.
The Germany DAX30 Chart
The Germany DAX30 chart is displayed & shown above. On above example this instrument is named GER 30CASH. As a trader you want to find a broker that provides Germany DAX30 chart so that you can begin to trade it. Example displayed above is of Germany DAX30 Indices on MT4 FX Trading Platform.
Other Details about Germany DAX30 Stock Index
Official Symbol - DAX:IND or GDAXI
The 30 components stocks which constitute Germany DAX30 Index are re-evaluated few times each year to determine if to make changes to this composition or not. Stocks which aren't performing well may be replaced with other stocks which are doing well.
Strategy for Trading Germany DAX30 Stock Index
The Germany DAX30 Index is made up of blue chip stocks which trade in Frankfurt Bourse selected from the top performing sectors in Germany; therefore a good indices trade strategy to trade Germany DAX30 Index is to trade long most times. This is because generally the best stocks in Frankfurt Bourse will generally keep heading up & up because the corporations behind these stocks are the best & most lucrative corporations in Germany.
The Germany DAX30 Index is also revised few times each year so that if one Stock Indices isn't doing well then it's replaced with an alternative blue chip Stock Indices that's doing good. This ensures that most times Germany DAX30 Stock Index will keep moving upwards.
As a trader you want to be biased and keep buying as the index moves upwards. When German economy is performing good (most of the times it's performing good) this upward trend is more likely to be in-favor. A good stock indices trade strategy would be to buy the dips.
During Economic Slow-Down & Recession
During economic slow-down and recession times, companies start to report lower profits and lower growth prospect. It is due to this reason that investors start to sell stocks of companies which are reporting lower profits and therefore Stock Indices tracking these specified stocks also will begin to move downward.
Hence, during these times, trends are likely to be moving downwards & you as a trader should also adjust your trading strategy accordingly to suit the prevailing downward trends of the stock index that you're trading.
Contracts and Specifications
Margin Requirement Per Lot - € 85
Value per Pip - € 0.1
Note: Even though general trend is generally move upward, as a trader you've got to consider and factor in daily market volatility, on some of the days the Indices might move in a range or even retrace & pull-back, the market retracement move may also be a significant one at times & hence as a trader you need to time your entry precisely when using this strategy and at same time use proper money management guidelines just in case there's more unexpected volatility in the market movement. About equity money management methods in indices lessons: What is Index equity management & Indices equity management strategies.
