what is index trading?

Answer 1

It is trading quite large collections of stocks rather than individual stocks. One of the most famous indexes is the S&P 500, which is a collection of 500 popular stocks. The performance of the S&P 500 will be very similar to the performance of the stock market as a whole. The reason for investing in indexes is that it reduces risk greatly. If you only have one stock, your investment could fluctuate wildly. If you have a collection of 500 stocks, if one stock goes down a lot, it doesn't make much of a difference because there are 499 more stocks.

Answer 2

The idea is simple: A representative group of stocks (or bonds) is selected from a specific market or sector to serve as a benchmark or index. By investing in a portfolio of the securities that compose the index, you seek to track the performance of the index.

Take Cereal:
There is Kellogs, General Mills, Quaker Oats. They can be considered the representative group of Cereal Companies and/or Stocks one could buy in the grain segment. As prices rise on Cereal, the perspective grain companies profits may also rise and as a group / index we can follow their growth or downfall. Trading on the index - we may be affected by market fluctuations but indexes have a lower risk as the index is normally comprised of several stocks from several companies like the dow jones..

Answer 3

An index is a basket of securities, whether they're stocks, bonds, etc.

Some people invest in them as a way to diversify, while others are looking for a quick profit by buying it and then selling it soon afterwords.

For example, the S&P500 invests in a basket of top 500 companies. The Russell 2000 invests in a much broader variety of stocks, 2000 to be exact.

Answer 4

The secret word of trading success is "organized". You can't be successful without a strategy, a plan and some kind of technological support. I use a software called "autobinary signals" that is helping me a lot. There are plenty of them on the market. I recommend this one because it's very easy to use (you don't have to be an expert or have special skills to make money with it).

Check it out here. It's worth it: http://tradingsignal.toptips.org

Answer 5

the best trading software http://tradingsolution.info
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if you are serious about trading you need to address your weakness and try to fix it. no forex guru can make you Professional trader unless you want to learn from your mistake.