Indices

What are indices?

Indices serve as a gauge for assessing the performance of a collection of listed stocks on an exchange. Given that there is no tangible asset involved in index trading, the majority of index trading relies on financial derivatives such as CFDs.

In an effort to offer investors and market participants a broader array of investment opportunities, PMEX has introduced trading in the indices of the world's four largest stock exchanges:

• DOW JONES 30
• SPX 500
• NASDAQ 100
• NASDAQ 100

DOW Jones

The Dow Jones Industrial Average (DJIA) stands as one of the oldest, most renowned, and widely utilized indices globally, comprising the stocks of 30 of the largest and most impactful companies in the United States. Serving as a prominent benchmark index for blue-chip stocks in the U.S., the DJIA is a price-weighted index that monitors 30 significant publicly-owned companies listed on the New York Stock Exchange and the NASDAQ. Originating in 1896 and named after Charles Dow, the Dow Jones offers a means to efficiently access the primary benchmark for the U.S. stock market through a small-sized electronic contract, potentially leading to reduced trading costs compared to individual stocks or Exchange-Traded Funds (ETFs).

NASDAQ

NASDAQ, which stands for the National Association of Securities Dealers Automated Quotations, is commonly used to denote the Nasdaq Composite. This index comprises over 3,000 stocks from the Nasdaq exchange, featuring leading technology and biotech giants like Apple, Google, Microsoft, Oracle, Amazon, and Intel. Serving as a global electronic marketplace for securities trading, Nasdaq holds the distinction of being the world's inaugural electronic exchange. Renowned technology companies, including Apple and Facebook, find their listings on Nasdaq. Operating 25 markets, one clearinghouse, and five central securities depositories in the United States and Europe, Nasdaq offers the NASDAQ-100 Index futures as an efficient means to gain exposure to the top 100 large-cap domestic and international non-financial companies listed on The NASDAQ stock market. This approach facilitates potential cost savings compared to trading individual stocks or Exchange-Traded Funds (ETFs).

SPX

The Standard & Poor's 500 Index, commonly referred to as the S&P 500, surpasses the DJIA in terms of size and diversity. Comprising 500 of the most actively traded stocks in the U.S., it represents approximately 80% of the total value of U.S. stock markets. Serving as a reliable indicator of overall movement in the U.S. marketplace, the S&P 500 includes companies across various sectors such as energy, industrials, information technology, healthcare, financials, and consumer staples. The S&P 500 futures contract provides an efficient means to gain exposure to the principal benchmark for large-cap U.S. stocks and is considered one of the most liquid stock index futures contracts globally. Additionally, this approach offers potential cost savings compared to trading individual stocks or Exchange-Traded Funds (ETFs).

NIKKEI 225

The Nikkei 225, also known as the Nikkei Stock Average, serves as a stock market index on the Tokyo Stock Exchange, gauging the performance of 225 prominent publicly owned companies in Japan across diverse industry sectors. As Japan's primary stock index, it encompasses the country's top 225 blue-chip stocks. Utilizing a price-weighted methodology, the Nikkei calculates an average of the share prices of all listed companies. Notable entities listed in the Nikkei include Sony Corporation, Canon Inc, Nissan Motor Company, and Honda Motor Company. The Nikkei 225 futures contract offers an efficient avenue to gain exposure to the principal benchmark for large-cap Japanese stocks, recognized as one of the most liquid stock index futures contracts globally. Moreover, this approach provides potential cost advantages over trading individual stocks or Exchange-Traded Funds (ETFs).