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We’ll highlight some popular brokers you can use to invest in the DAX today.
Research DAX Investment
Before you jump into investing in the DAX, it’s important to understand what it is. We’ll cover everything you need to know and highlight some strategies you can use to make money from investing in the DAX.
What is the DAX Index?
The DAX index tracks the value of 30 of the largest companies by market cap that trade on the Frankfurt Stock Exchange in Germany.
The index is dominated by giant German corporations like Volkswagen, Daimler, Allianz, Bayer, Deutsche Bank, Siemens and BMW. Because of this, the DAX is much more oriented toward traditional and so-called “old economy” sectors like car manufacturing, aviation and heavy industry. In that sense, it’s very different from the US stock indices like the S&P 500 and the Nasdaq, which are more technology heavy.
The DAX is very popular to trade, and as a result is highly liquid with tight spreads and long trading hours.
For any investors looking to have exposure to the fifth largest economy in the world and the largest one in the European Union, the DAX is a place to start. The index may only cover 30 companies, but it represents a huge swath of the German economy.
Another reason to invest in the DAX is to achieve diversification. If you are heavily invested in tech stocks through the S&P 500 and the Nasdaq indices in the US, the German DAX gives you exposure to automakers, heavy industrial companies, and financial stocks.
It’s also worth pointing out that Germany’s economy is in the midst of a transformation. European stocks are increasingly moving towards the tech sector, particularly after the COVID-19 pandemic. The DAX stands to be one of the major beneficiaries in the EU market in the years to come.
FAQs
What time does DAX open?
The FSE trading hours for the DAX are 09:00 GMT to 17:45 GMT and most providers will also give pre and post-market indications. This is to help traders gauge where markets are expected to open and where they are quoted after the official market has closed.
Ilija Rajakovic is a Serbian-based investor and writer. His main focus areas include finance, trading, and macroeconomy.
Ilija holds a Master’s Degree in Investment Banking and is pursuing his Ph.D. with a focus on sustainable finance and development. He is actively managing personal investment portfolios and advising private clients. And has run a website which generated actionable stock market ideas and provided insights into global economic landscape in the past.
His economic articles have been publshed in highly respected magazines like NIN and Magazin Biznis.
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