Index Trading

Trade global indices with low commissions and tight spreads on an ECN account with FXOpen.
Open an index trading account
with FXOpen

FXOpen: Index trading for the experts

Trading indices offers a different challenge to traders in that it involves speculating on the performance of a group of stocks rather than one single asset. They provide a highly liquid market, with typically longer trading hours. Some of the biggest global indices have long, illustrious histories.

Advantages of index trading with FXOpen

Peace of mind Peace of mind

One platform with multiple instruments and markets

With us, you can use one platform for index trading as well as for commodities (metals and energy only), forex, shares and cryptocurrency* CFDs.

We want you to be a successful trader We want you to be a successful trader

You're trading with an FCA regulated broker

Your funds are fully protected up to £85,000 by the FSCS.

Make your money go further Make your money go further

Highly customisable

to your individual trading style and strategies, meaning you are in complete control of your index trading.

Ultra-fast execution Ultra-fast execution

Access to automated trading

You have the choice to download and use ready-made scripts and expert advisors or create a custom indicator or script, based on your very own index trading strategy.

Your choice of trading strategy Your choice of trading strategy

Access anytime, anywhere

via the desktop, web-based or mobile version of the MT4 trading platform. The web-based version is particularly useful for Apple Mac users, where a direct download is not available.

200+ markets offered 200+ markets offered

Access to a wide range of analysis

50+ built-in indicators and graphic tools for technical analysis, quotes history centre, strategy tester and news, all designed to help you increase your index trading knowledge.

Open an index trading account
with FXOpen

What are indices in trading?

Indices are a method of measuring the performance of a group of stocks from one particular exchange. They offer an alternative option for traders who may be looking to gain a wider view of the market – one they may be unable to obtain by analysing the performance of shares in a single company.

Via index CFDs, you can speculate on the performance of indices without owning the underlying asset. Index trading means you can access entire sectors without having to take up multiple positions.

The risks and rewards of index trading

All forms of trading come with risk attached and investing in indices is certainly no different. Before you begin, it’s important you take the time to develop your understanding of the markets and how their performance can be impacted by certain determining factors. Once armed with that information, you can begin to make decisions with greater clarity.

Indices are highly liquid and offer more trading hours than most markets, so there is certainly the potential to make profitable trades. The flip side of that liquidity, however, is that the markets can also go against you. It’s vital that you have a strategy in place that will enable you to minimise and cover any losses you do incur.

Index trading with FXOpen

When you register for an index trading account with FXOpen you gain access to our cutting-edge platform. We’re fully regulated by the FCA and offer FSCS protection up to £85,000, while our trading software means you can access multiple instruments – including forex, shares, commodities and cryptocurrency* – all from one account.

Registering is easy – all you need to do is fill in our simple form and go through the identification verification checks. So, why not get in touch or open an account and begin your index trading journey today.

How are indices calculated?

The calculation of most indices is based on the market capitalisation of the organisations that comprise that index. In this instance, the larger cap firms have greater weight, so their performance will have a more significant impact on the value of the index than the companies with a lower market capitalisation.

But there are some global indices that are weighted by the price of a company’s shares. So, the performance of those businesses with a higher share price has a greater bearing on the index than those whose share prices are lower.

Examples of global indices

There are a number of global indices available for you to trade. Here are some that tend to prove the most popular:

  • Wall Street 30 (Dow Jones Industrial Average): Tracks the performance of 30 of the biggest publicly traded firms in the United States.
  • Germany 40 (DAX): Made up of the 40 largest companies on the Frankfurt Stock Exchange.
  • UK 100 (FTSE 100): The UK’s largest 100 firms, by market capital, as listed on the London Stock Exchange.
  • US Tech 100 (NASDAQ 100): Measures the performance of the 100 biggest non-financial companies in the United States. Also referred to as the US Tech 100 due to its heavy focus on the technology sector.
  • Japan 225 (Nikkei 225): A price-weighted index covering 225 of Japan’s largest companies.

The factors that affect index trading

Because global indices encompass a wider range of companies than when trading individual assets, there are several factors that can impact their performance. For example, commodity prices can have a huge bearing on exchanges like the FTSE 100, which has a significant proportion of commodity stocks.

Then there are changes to a company’s structure or composition, which could have an effect on its market capitalisation or share price and subsequently impact the performance of that index.

Traders will also closely monitor companies’ financial results, which can have a direct bearing on their share prices. Economic and geopolitical developments are also likely to play a part in the performance of certain global indices.

How to define success in index trading

Trading global indices successfully is no easy feat but with detailed analysis, a clear strategy and the ability to quickly weigh up the risks versus the rewards, you’ll give yourself a far greater chance.

One trader’s idea of success might look entirely different to that of another, so the important thing is to define your goals and lay out a plan that will help you to reach them. It’s crucial to manage your expectations and try to avoid making emotional decisions. Use your in-depth research to guide you and construct a strategy that enables you to mitigate any potential losses. That will enable you to start your index trading journey with increased confidence.

Open an index trading account
with FXOpen

*Cryptocurrency CFDs are only available for trading by those clients categorised as Professional clients under FCA Rules. They are not available for trading by Retail clients.