The EU50 Index
The EU50 Index shows movement of the top 50 Blue Chip Stocks in EU Zone. These stocks are selected from most lucrative business sectors of the EU Zone economy. The Top 50 Stocks are also chosen from a variety of EU Zone countries. These 50 stocks are the most liquid stocks in EU Zone. The countries Included are 12 in total & these are:
- Germany
- France
- Netherlands
- Portugal
- Spain
- Belgium
- Finland
- Italy
- Austria
- Greece
- Ireland
- Luxembourg
The EU50 Stock Index is represented on a chart as a Financial Trading Instrument just like the currencies and stocks, & this chart can be transacted just like fx charts.
The EU50 trading chart movement can be analyzed/interpreted using technical analysis & other indicators can be added on this Trading Chart.
The EU50 Chart
The EU50 trading chart is illustrated and illustrated below. On example laid-out below this financial trading instrument is named EU 50CASH. As a trader you want to find a broker that provides EU50 chart so that you as a trader can start to trade it. Example shown and displayed below is of EU50 Indices on MetaTrader 4 Forex Software Platform.
Just as currencies, a stock index trader can use their own strategy or system to trade these Indices the same way which they trade currencies. Traders can even use their Expert Advisors(EAs) to trade these Indices.
Other Details about EU50 Index
Market Time - 0900 - 1800 CET
Stock Indices Symbol - SX 5E or SX5E
The 50 component stocks which constitute EU50 Index are re-evaluated once each year to figure out if to make changes to this composition or not.
Strategy for Trading EU50 Index
The EU50 Index is made up of blue chip stocks choosen from the top performing sectors in the Euro Zone: therefore a good indices trade strategy to trade EU50 Index is to trade long majority of the times. This is because generally the best stocks in Europe will in general keep heading up and up because the corporations behind these stocks are among the best and most profitable companies in Europe.
The EU50 Index is also re-evaluated yearly so that as if one Index is not performing well then it's replaced with an alternative Indices that is doing good. This ensures that most of the times EU50 Index will keep heading upwards.
As a stock index trader you want to be biased & keep on buying as the index heads and moves upward. When European based economies are doing and performing well this upwards trend is more than likely to be the one that is ongoing. A good stock indices trading strategy would be to buy the price dips.
During Economic Slow-Down & Recession
During economic slowdown and recession periods, corporations begin to report lower earnings, lower profits and slower growth projection. It is due to this reason that investors begin to sell stocks of companies which are announcing and recording lower profits & therefore Index tracking these specific stocks will also begin heading downward.
Hence, during these times, trends are much more likely to be heading & going downwards & you as a trader should also adjust your strategy accordingly to suit the prevailing downwards trends of the index which you as a trader are trading.
Contracts and Details
Margin Requirement for 1 Lot - € 40
Value per Pip - € 0.1
Note: Even though overall trend is generally moves upward, as a trader you've got to consider and factor on daily price volatility, on some of the days the Indices may move in a range or even retrace and retracement, the market correction/retracement move may also be a substantial one at times & therefore you as a trader you need to time your trade entry strictly when using this trading strategy: Stock strategy and at same time use the suitable & proper & suitable money management guidelines/principles just in case of more unexpected volatility in the market movement. About Stock index money management rules courses: What is index equity management & Stock Index money management methods/strategies.
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