DAX 30 News and Analysis

Germany

Dax 30 Index Pares losses, Political Concerns Persist

Although there was a more defensive tone surrounding risk appetite and renewed concerns surrounding the Greek debt situation, German stocks were resilient with only...
Germany

Wall Street Advance Underpins Dax 30 Index

Although the performance was unconvincing for much of the session, gains in US markets following a lower than expected average earnings reading were pivotal...
Germany

DAX 30 Recovers Losses, UK Brexit Stance Underpins Confidence

Concerns surrounding trade policies under the new US Administration undermined the DAX in early trading before the UK Brexit stance offered support, especially with...
Germany

DAX 30 Boosted by Corporate Optimism, ECB Stance in Focus

Although there was a sharp retreat in mid-week on US concerns, there was solid underlying support surrounding the German economy and corporate earnings, which...

DAX Chart

The DAX 30 is the key benchmark for the German stock market, and is the most popular index to trade in Europe and considered one of the top indices in the world. The German economy is the largest in Europe, and one of the largest globally, and thereby making the DAX 30 an important global stock market barometer. The index is made up of 30 blue chip stocks which trade on the Frankfurt Stock Exchange. The DAX 30 is made up of companies with heavy exposure to the global economy and is weighted by market capitalization; which provides the heaviest weightings to the largest companies. The German index began trading in 1987 at a base value of 1,000.

How to trade the DAX 30

Futures

The DAX 30 futures contract trades on the Eurex. The exchange code is “FDAX”. The notional contract value is determined by multiplying the current index value x €25 (i.e. 10,000 x €25 = 250,000). Futures can allow a trader to use a large amount of leverage, so understanding the leverage behind a position is important.

One of the drawbacks is the large margin requirements, which is why a smaller contract has been created. Like the popular and liquid US index futures contracts, the DAX also has a smaller ‘e-mini’ contract available under the exchange code, “FDXM”. It has a multiplier of €5, or 1/5 the size of the full-sized contract. (Notional contract value = €5 x current price of the DAX). These are attractive due to the requirement for less margin and ability to adjust larger position sizes more precisely.

There are four main expiration months – March, June, September, and December.

Exchange Traded Fund (ETF)

The DAX 30 can also be traded via the iShares Core DAX UCITS ETF (DE), ticker symbol – EXS1 – and trades in Frankfurt. It is designed to mimic the price movements of the DAX index. It is an effective way to trade the German index due to its low expense ratio, availability to investors of all size, and liquidity.

Options

Options are available for both futures and the ETF. It is suggested that one familiarize themselves with how options work before trading them. This is one of the least capital intensive ways to trade the DAX 30, as options premiums can be as low as a few euros per contract. Traders can use options as a hedge or to speculate on the direction of the index, both up and down.

Contract for Difference (CFD)

This instrument was designed with the small trader or investor in mind. CFDs are constructed with futures contracts, but made into smaller contracts which require significantly less margin than futures contracts. Just like futures, these trade nearly 24-hours a day, 5-days a week. Most traders in the world outside of the United States have access to a broker who offers CFDs. These can be traded in both directions, long and short.

What impacts the DAX 30?

The Eurozone and global economic conditions weigh significantly on this index as it has such large international exposure. As Europe’s largest economy, not only how the economy is faring in Germany matters, but in the Eurozone as a whole. The interconnectedness of the global economy makes Germany reliant on strong trading partners for healthy economic growth.

Central Bank activity impacts the German economy and stock market as it does in other developed countries. Changes in monetary policy by the European Central Bank (ECB) (i.e. interest rate changes, quantitative easing) have an impact on investor sentiment and market performance.

The DAX 30 is concentrated on a few large constituents. It is important to understand what constituents will move the index given the heavy weighting placed on a small number of the 30 stocks in the index. The top 10 names make up nearly 60% of the entire index (August 2016).

1,749FansLike
9,753FollowersFollow
1,073FollowersFollow

Real-Time Indices Futures

IndicesBidAsk
Real Time Streaming Futures Quotes by FXCM

Upcoming Economic Events

Other News

oil tanks with oil tanker

API Reports Unexpected 0.88 Million Barrel Inventory Draw, WTI Oil Price Rallies

The latest weekly American Petroleum Institute (API) inventory data for the week ending February 17th reported an inventory draw of 0.88 million barrels. ...
uranium price

Uranium Spot Prices Run Out of Momentum

The uranium spot price rally stalled last week, ending the commodity's ascent that started in December after prices fell as low as $17.75 per...
Canada Dollar USD/CAD

USD/CAD Bulls Disappointed by Fed Minutes

The Canadian dollar weakened after poor retail sales data, but USD/CAD hit resistance above 1.3200 and retreated after the Fed minutes provided no hawkish...

Nickel Prices Tracking US Dollar

Nickel prices were lower Wednesday, even after the commodity fell under significant pressure in the prior session.While all the base metals faced some pressure...
Natural Gas

Natural Gas Prices Stabilize Following Tuesday’s Sharp Decline

Natural gas prices fell sharply on Tuesday, with the contract for April settlement on the New York Mercantile exchange losing in excess of 8%....