Trading In Indices
Learn what stock market indices are and why they are such a popular investment choice on the Markets Trading binary options trading platform.
A stock market index is an aggregate measure of how valuable a particular segment of the market is. It is calculated by obtaining a weighted average of several related stocks from a market. For example, some technology stocks are traded on the NASDAQ exchange, while the NASDAQ Index is a weighted index of the market capitalization of all the stocks listed on the exchange.
Binary options traders are able to trade on a wide variety of global indices. These represent the performance of the stock market of a given nation which in turn, reflects investor sentiment on the state of its economy. The most regularly traded market indices are those which are composed of the stocks of large companies listed on a nation’s largest stock exchanges, such as the American S&P 500, the Japanese Nikkei 225 and the British FTSE 100.
Trading in indices as an underlying asset provides a great way for you to profit from binary options. This is because trade in indices offers several distinct advantages over trade in individual stocks. While individual stocks can bring about sudden and unexpected losses when their prices rise and then fall quickly and unexpectedly, the diversification of indices means they carry less risk.
When you trade binary options based on indices with Markets Trading, you enjoy exposure to the full complement of stocks that form that index without having to purchase any of these stocks individually. This offers both cost and diversification advantages. As a result, you will gain first class access to trade some of the most popular indices in the world including the FTSE 100, the Dow Jones, the S&P 500, DAX 30, NASDAQ 100, Nikkei 225, the Hang Seng, and many more.
and to take control of your financial destiny.