SX5E Index
SX5E Index represents the trend movement of the top 50 Blue Chips Stocks in EuroZone. These stocks are selected from most profitable sectors of EuroZone economy. The Top 50 Stocks are also selected from a variety of EuroZone countries. These 50 stocks are the most liquid stocks in EuroZone. The countries Included are 12 in total & these are:
- Germany
- France
- Netherlands
- Portugal
- Spain
- Belgium
- Finland
- Italy
- Austria
- Greece
- Ireland
- Luxembourg
SX5E Index is represented on a chart as a Financial Instrument just like currencies & stocks, and this trading chart can be traded just like ++forexforex charts.
SX5E trading chart movement can be analyzed using technical analysis & other indicators can be placed on this Chart.
SX5E Chart
SX5E trading chart is shown and illustrated below. On the example below this financial instrument is named SX 5ECASH. As a trader you want to find a broker that provides SX5E trading chart so that you can begin to trade it. The example That is shown below is that of SX5E Indices on MT4 FX & Indices Software.
Just as currencies trading, a trader can use their own strategy or trading system to trade these Indices the same way that they trade currencies. Traders can even use their Expert Advisors to trade these Indices.
Other Information about SX5E Index
Market Time - 0900 - 1800 CET
Official Indices Symbol - SX 5E or SX 5E:IND
The 50 component stocks that makes up the SX5E Index are revised once every year to determine if to make changes to this composition or not.
Strategy to Trading SX5E Stock Index
SX5E Index is made up of blue chip stocks choosen from best performing sectors in the EuroZone: hence a good stock index trade strategy to trade SX5E Index is to trade long most times. This is because generally the best stocks in Europe will generally keep heading up and up because the companies behind these stocks are the best & most lucrative companies in Europe.
SX5E Index is also reviewed yearly so that if one Indices is not doing well then it is replaced with another Indices that is doing good. This ensures that most of the times SX5E Index will keep going up.
As a trader you want to be biased & keep buying as the index moves upward. When European economies are doing well this upwards trend is more than likely to be ruling. A good index trade strategy would be to keep buying the dips.
During Economic Slow-Down & Recession
During economic slow-down and recession times, firms begin to report lower profits & lower growth prospect. It is because of this reason that investors start to sell stocks of companies that are reporting lower profits & hence Indices tracking these specified stocks will also start to move downward.
Therefore, during these times, market trends are likely to be moving downward & you as a trader should also adjust your strategy accordingly to suit the prevailing downwards trends of the stock index that you're trading.
Contracts & Specs
Margin Requirement Per Lot - € 40
Value per Pips - € 0.1
Note: Even though general trend is generally move upwards, as a trader you have to consider & factor in daily market volatility, on some of the days the Indices might move in a range or even retrace & pull-back, the Stock Indices market retracement move may also be a significant one at times and hence as a trader you need to mark-time your trade entry precisely using this trade strategy & at same the time use proper equity money management guidelines just in case there is more unexpected volatility in the market. About equity management strategies in Stock Indices lessons: What's Stock iindices equity money management & Indices equity management strategies.
