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    What is a stock market index? A stock index is a performance indicator or measure of a country's economy or of an industry sector. For example, Nasdaq represents the largest companies traded on the Nasdaq Stock Exchange.

    If, on average, the share price of these companies goes up, then the index will rise. Conversely, if they fall, the index will drop.

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    Most main indices are based on a basket of shares and are thus considered good measures of the current market sentiment. When you take a position on an index, you are effectively investing in the performance of these shares and thus avoid factors that influence the performance of individual companies such as Forex autotrader lack of market volume. For a kaip greitai gauti 500 USD internetu list of index futures CFD offered on the Plus platform, click here.

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    How is a stock market index calculated? Stock market indices have different forms of calculation.

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    These are the two most common: Adjusted market capitalisation or cap-weighted is used to track a number of companies based on the adjusted market capitalisation of the constituent stocks. Price-weighted average — adds up the stock prices of all constituents, and then divides that figure by the total number of stocks in the index. Dow Jones is an example of an index that is calculated this way.

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    How does leverage work in Index CFDs? By trading index futures contracts with leverage, you can multiply the value of a trade through the use of borrowed capital, and as such, you can increase the potential profit or loss to be realised from the trade.

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    The available leverage for index CFDs on the Plus platform is up to What are the highlights of trading Index CFDs? Here are a few highlights of trading Index CFDs: You can gain diversified exposure using a single instrument — as most factors that affect individual companies are taken out of the equation.