Dow Jones Industrial Average tracks 30 influential corporations in the US.
S&P/ASX 200 tracks blue-chip stocks on the Australian Securities Exchange (ASX).
S&P 500 is another US-based index tracking 500 American blue chips.
FTSE 100 focuses on the top UK companies.
NASDAQ 100 is unique because it only lists the largest non-financial companies in the US. Most of the current listings are tech companies, so the index has become a barometer for the tech industry.
DAX 30 tracks the most significant German companies and is often quoted as a measure of the economic health of continental Europe.
Hang Seng includes the largest companies in Hong Kong.
Nikkei 225 covers Japan's biggest corporations, but it is often cited as an economic measure for the entire Asia-Pacific region.
EURO STOXX 50/600 tracks the biggest companies in the Eurozone, which includes all economies that rely on the Euro currency.
CBOE Volatility Index (VIX) measures the 30-day volatility (degree of price change) in the US stock markets.
Frequently Ask Question
If you trade share CFDs, your analysis will focus on financial data and charts for one company. However, with indices CFD trading, you will look at the economy and the stock market as a whole.
Also, you can use leverage to increase the size of your position without having to contribute more capital. The capital requirements for indices CFD trading are much lower than those for trading index ETFs or futures.
CFDs also track the underlying index. Other derivatives, such as options on index ETFs or futures, do not mirror the price movements as closely due to expiration and time decay, market expectations, and other factors.
- Geopolitics can either inspire confidence in the markets or cause uncertainty. Treaty announcements, conflicts, international disagreements, and political changes can cause bear or bull markets depending on whether investors see the changes as positive or negative.
- Interest rate changes and other monetary policy decisions, which usually come from a central bank, can cause a country's stock market index prices to fluctuate.
- Government policies, such as trade deals and corporate tax rate changes, can affect stock market index performance. Generally, more pro-business decisions, such as lower tax rates or incentives for certain industries, cause index prices to rise. Meanwhile, tax increases, new regulations, and other factors slowing business processes can cause a drop in index value.