Trading indices is one area that is recommended for novice traders as they will usually involve relatively low risk levels. Indices track the combined performance of multiple companies or even diverse asset classes and often serve as a benchmark for the best results on their respective market, as they tend to collect the top performers in a certain sector or group of sectors. They provide exposure to the entire group of underlying assets at a fraction of the cost (and effort) that would be required to buy the individual instruments making up the index.
Index prices depend on the prices of their underlying assets, but also depend on supply and demand. E.g., when demand for a given index is high, its price will rise regardless of the current cumulative prices of its constituent assets. There is a vast number of indices available around the world, so making a right choice will involve learning as much as possible about the way they are created and the markets they are related to.
One of the reasons clients choose to trade indices with TRDPremium is the quality of our services and our helpful support team. We also offer various educational tools, including e-books, private lessons, webinars, etc. We provide tight spreads and trading 24 hours a day, offering our clients some of the most attractive indices on the market, including the Dow Jones, FTSE, DAX, and more.