How Do You Setup For Stock Indices Trading?

Stock indices are the newly introduced leveraged products for online trading. Traders wanting to begin trading these indices should first of all take time so that as to learn how the indices markets work. Traders should take time to learn about leverage - leverage is when a trader is given $100 dollars to trade with for every $1 dollar of their own. For example, if a trader has capital of $20,000 dollars to begin with, then after getting leverage from their brokers traders will now control $2,000,000 and they can now open transactions worth up to $2,000,000 dollars. This is what leverage is, a trader gets more money to invest with. This is what makes online stocks indices popular.

However, with leverage a trader has to learn how control this leverage by learning money management methods. Money management methods will show traders how to control leverage so that they can use this leverage to their advantage & make profits.

The best way to learn about the indices is to open a demo account, that way as a trader you will learn about Stock Index investing without depositing money. The demo account is a practice account where a trader can practice with virtual currency - everything else about the demo account is similar to the real account except for the virtual currency used in a demo account. The demo account will provide beginner traders with access to the real Indices market. A trader can practice with this demo account until they are ready to open a real account and begin trading the indices market with invested capital, where profits can be withdrawn & losses deducted from their capital.

Below is a list of tutorials containing all the information that beginners require to start.

1. Introduction to Stock Indices

2. Indices Financial Instruments

3. Market Hours

4. Strategy

5. System

6. Trading Plan

7. Market Sentiments

8. Advantages of Stock Indices

9. One of the Best Stock Indices Broker

The above tutorials will provide beginners with the best starting point when it comes to learning. Other lessons that can be applied to online indices are:

Start Stock Index Trading - Stock Indices Lessons

How to Start

The first thing that a trader has to do so that as to begin is to download the Indices platform and then install this trade software on their computer so that as to get access to the online indices market.

Once you have downloaded & installed the platform you will then open a demo account, then you will be ready to start.

The next thing one has to do is to learn the various Stock Index instruments available for online trading. These instruments are:

EUROSTOXX 50
DAX30
DowJones30
FTSE100
Nikkei225
S&P ASX200
FTSEMIB40
S and P 500
NASDAQ 100
CAC40
SMI20
AEX25
HangSeng50
IBEX35

In the online Indices market only the most popular indices are available for online trading, these are the 14 that are displayed above.

Where to Find these Stock Indices on Trading Software

As beginner you may want to know where to find these financial instruments on your trading platform, this is shown and illustrated below.

What's Best Stock Index Trading Guide for Index?

Indices Instruments on Trading Software

A trader can find these instruments from the "Market-Watch" window that is shown and illustrated above. To find the marketwatch window popup on the platform above a trader can follow these steps: click "View" next to "File" at the top left corner, from the drop down menu select "Market-Watch", the above MarketWatch pop up window will popup displaying a list of these Indices. Alternatively use the keyboard shortcut keys - CTRL+M.

If some of these instruments are not shown on the platform a trader can follow the steps below so as to have these instruments shown on the above marketwatch window.

Right click within the MarketWatch window and then choose "Show All" as shown below:

What's Best Stock Index Trading Guide for Indices?

Display all Stock Indices on Trading Software

You can choose to open charts by selecting a particular Indices & open its chart.

After opening all the instruments that you want you may also want to then click "Hide All" as shown above so that as to hide those instruments that you are not trading as well as save internet bandwidth by only streaming the financial instruments that you are trading.

After choosing all the 14 indices as shown above you are ready to begin practice trading these instruments on your demo account.

Indices Trade Charts

Indices are analyzed using charts, the indices values are plotted on a chart graph & these charts is then traded like a financial instrument for the purpose of speculation & making profit.

As an example the US 100 weekly index trading chart is shown and illustrated above. The movement is measured in points. The above index current value is 4471.10 - A trader can buy this instrument & if the value then appreciates to 4471.50, the trader will have made a profit of 40 points. A trader can also sell the instrument & if the value moves down to 4470.50, the trader will have made a profit of 60 points.

For Indices a trader can make money both when the market is moving up or down. When a trader buys this is called going long & when a trader sells this is known as going short.

Indices Brokers

Traders gain access to the Online Stock Indices market through Stock Index brokers. These brokers are the ones that provide trading platforms, demo accounts, real accounts, trading charts & all the technical analysis tools required for trading Stock Index.

The brokers charge a small fee for every trade opened which is known as the spread. For example a broker may charge 3 points as their spread, therefore in the above example where profit is 40 points a trader would have to also factor 3 points that are charged for the trade by the broker - therefore the profit would be 37 points after factoring the broker's charges.

How Much Money to Start?

The minimum recommended capital to begin trading with is $10,000 dollars. Starting with any amount below this will mean that you will be undercapitalized. Most traders begin with $10,000, $20,000 or $50,000 dollars, this way they are well capitalized & therefore they have better chances of making profits.

Those traders that begin with less capital are undercapitalized & under capitalization is one of the things that makes most traders not to succeed. Just like all other businesses, if you start any business while undercapitalized chances of the business not succeeding are greater as when compared to when you start a business while having enough capital - the same with online stock indices trading.

How Do You Use Practice Accounts?

Practice accounts allow traders to practice trading indices without having to invest or deposit money, this way a trader can learn & decide if stock indices trading is suitable for them or not. If as a trader once you have practiced & are making profits on your demo account then you can open a real account, deposit money as capital & begin trading these instruments for profits.

The recommended time for demo account practice is 30 days. These 30 days as a trader you will continue to learn topics about stock indices trading so that you can continue improving your trading skills while at the same time practicing on the demo.

Technical Analysis & Strategies

The nest thing to do is to make a point of learning the various technical analysis topics used to analyze Indices movements as well as strategies used. On this website you will find all the information about these strategies & technical analysis tutorials required to help you improve your skills so that to increase your knowledge & also your chances of making profits in this online Indices market.

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