What is FTSE MIB 40 Strategy? - Tutorial Guide to FTSE MIB 40 Stock Index
The FTSE MIB 40 Index Trade Chart
The FTSEMIB40 Index chart is displayed & portrayed above. On the above illustration this financial instrument is named IT 40CASH. As a trader you want to find a broker that provides FTSE MIB 40 Stock Index chart so that as you as a trader can start to trade it. Example displayed and shown above is of FTSEMIB 40 Stock Index on the MT4 Forex Platform Software.
Strategy of Trading FTSE MIB 40 Index
FTSE MIB 40 Index generally upwards over long-term because the stocks choosen represent best sectors in the Italian economy hence in general this index will keep heading up over time - because these are the sectors of the economy that will be doing good business.
As a trader wanting to trade this stock index, you want to be more biased towards upwards market trend direction of this index.
As a trader you want to buy as the index heads and moves upward. When the Italian economy is performing good (most times it's performing good) this upward trend is much more likely to be the one ruling. A good index trading strategy would be to buy dips.
During Economic SlowDown and Recession
During economic slow-down and recession times, firms begin to report slower revenues and earnings, slower profits & slower growth projection. It's because of this reason that traders start to sell stocks of companies which are recording and reporting lower profits & therefore the Indices tracking these specific stocks also will begin to move and head downward.
Hence, during these market times, trends are much more likely to be heading downwards & you as a trader should also adjust your trading strategy accordingly to suit the prevailing downwards trends of the index which you're trading.
Contracts and Specifications
Margin Required Per 1 Lot - € 250
Value per Pips - € 1
Note the pip value of IT40CASH is € 1 compared & analyzed to the size of the other indices such as Germany DAX & EUROSTOXX 50 whose size of a pip per lot is € 0.1 - However, average pip movement for this index is much lower as compared to other stock indices like DAX30 & EURO STOXX.
NB: Even though general trend is in general moves upward, as a trader you've got to consider and factor in the daily market price volatility, on some of the days the Indices may oscillate or even retrace and pull back, market retracement move may also be a large one at times & hence as a trader you need to time your entry strictly using this strategy: Index strategy and at the same time use proper & appropriate money management strategies & guidelines just in case there's unexpected market volatility. About money management guidelines/strategies in indices trading lessons: What is Index money management techniques & guidelines and equity management system.
Learn More Lessons & Courses:
- How Can I Use Indicator Signals To Trade FX?
- SX 50 Index Trading Strategy Course Tutorial
- How to Place Zigzag Indicator in FX Chart on MT4 Software
- MT5 Zoom in, Zoom Out & Step by Step in MT5 Software
- Moving Average MA Triple Exponential Average Trading Indicator TRIX Indicator
