German Stock Market Spread Betting Guide

German Stock Market Spread Betting Guide

DAX 30 Spread Betting Guide

arrow_forwardLive DAX 30 Chart
arrow_forwardLive DAX 30 Prices
arrow_forwardWhere to Spread Bet on DAX 30
arrow_forwardHow to Spread Bet on DAX 30
arrow_forwardWhere to Spread Bet on German Shares
arrow_forwardHow to Spread Bet on German Shares

Welcome to our review of spread betting on the German stock market.

Whilst you can spread bet on individual German shares, a more popular trade is the DAX 30, i.e. trading an index of 30 leading German shares.

Whilst less popular than the DAX 30, you can also trade the MDAX, i.e. an index of 50 mid-cap German shares.

In this case we walk you through the basics of trading the DAX 30, MDAX and individual shares listed on the German stock exchange.

Readers should note that in financial spread betting, the DAX 30 is also known as the ‘DE 30’ and ‘German 30’.

Likewise, the MDAX is also known as the ‘DE 50’ and ‘German (Mid) 50’.


Live DAX 30 Chart and Prices


What is the Germany 30? (aka DAX 30)

The Germany 30 is measured by the performance of the 30 largest German companies, based on order book volume and market capitalisation.

The companies featured in the Germany 30 are decided on quarterly review. The market hours fall between 08:00 and 14:30 (UK time).


Where Can I Spread Bet on the DAX 30?

A number of regulated spread betting brokers offer live prices & charts on stock index markets like the DAX 30.

See the stock market comparison table below.


DAX 30 Spread Betting Comparison

Company Index Min
Stake
UK
100
Spread
Germany
30
Spread
Wall
Street
Spread
S&P
500
Spread
NASDAQ
100
Spread
Japan
255
Spread
Apply
Financial Spreads Review £0.50 0.8 (5) 1 (2) 1 (4) 3 0.5 8 Apply
City Index Review £1 1 (+) 1 (+) 1.6 (+) 6 1 (+) 8 (+) Apply
ETX Capital Review £0.50 1 (2,6) 1 (2,6) 1 (2) 5 1 (2) Variable Apply
IG Review £1-5 1 (4) 1 (5) 1.8 (5.8) 5 (9) 1 (3) 8 (30) Apply
InterTrader Review £1 Variable Variable Variable Variable Variable Variable Apply

You can also trade German mid-caps (MDAX) with IG and City Index.


How to Spread Bet on DAX 30

Let’s suppose that you are thinking of speculating on the DAX 30, you go on a spread betting site, such as CMC, and they are offering the current spread of:

DAX 30 Rolling Daily: 5826.0 – 5827.0

Here is how the trade works:

The Spread Betting Market DAX 30 Rolling Daily
Spread Betting Price 5826.0 – 5827.0
How the Market Works Now you can take a position on the DAX 30 Rolling Daily market moving:

  arrow_upward  Higher than 5827.0, or
  arrow_downward  Lower than 5826.0

This is a ‘Rolling Daily’ spread bet so it does not have a closing date. If you decide not to close your position and the session ends then your position will roll over to the next trading day.

Note that if the trade is rolled over then you will either receive or be charged a small fee for overnight financing based upon whether you are betting on the market to increase or decrease.

For further details also see what is a daily spread bet?
Units Traded Trades on the DAX 30 market are made in £x per point.

Where a point is 1 point of the index’s price movement.

E.g. if the DAX 30 moves 120 points then you would win or lose 120 multiples of your stake.
Stake Size You decide how much you would like to stake per point, e.g. £2 per point, £3 per point, £5 per point, £15 per point etc.
Staking Example With that in mind, if you have a stake of £3 per point and the DAX 30 moves by 20 points, you would win or lose £3 per point x 20 points = £60.


Worked Spread Betting Example | Going Long of the DAX 30

Spread betting on the stock market index to increase

You Now Decide Whether to Buy or Sell The DAX 30 to go:

  arrow_upward  Higher than 5827.0? or
  arrow_downward  Lower than 5826.0?

Let’s Say You Want to Buy   arrow_downward  Higher than 5827.0
You Decide How Much to Risk, Let’s Say You Opt For £1 per point
So What Happens Now?
  • You will win £1 for every point the DAX 30 goes higher than 5827.0
  • You will lose £1 for each point the DAX 30 goes lower than 5827.0
If You Are Speculating on a Market to Go Up Your Profits/Losses = (Closing Price – Opening Price) x stake per point
 
Trading Situation 1 The DAX 30 pushes higher and the market is adjusted and moved to 5920.2 – 5921.2.
Time to Lock in a Profit? You may choose to leave your bet open or close it, i.e. close your position to lock in your profit. In this instance you choose to close your bet and sell the market at 5920.2.
Your Profits/Losses = (Closing Price – Opening Price) x stake per point
(5920.2 – 5827.0) x £1 per point
93.2 points x £1 per point
Your Profits/Losses = £93.20 profit
 
Trading Situation 2 The DAX 30 pushes lower and the spread betting market is revised and changes to 5739.6 – 5740.6.
Close and Limit the Loss? At this point, you may opt to let your spread bet run or close it, i.e. close your position to limit your losses. In this instance you choose to close your position by selling the market at 5739.6.
Your Profits/Losses = (Closing Price – Opening Price) x stake per point
(5739.6 – 5827.0) x £1 per point
-87.4 points x £1 per point
Your Profits/Losses = -£87.40 loss


Fully Worked Trading Example | Taking a Short Position on the DAX 30

Financial spread betting on the index to decrease

You Select Whether to Buy or Sell The DAX 30 to move:

  arrow_upward  Higher than 5827.0? or
  arrow_downward  Lower than 5826.0?

You Might Want to Sell   arrow_downward  Lower than 5826.0
You Choose Your Stake, Selecting £3 per point
What Next?
  • You will lose £3 for each point the DAX 30 rises above 5826.0
  • You will win £3 for each point the DAX 30 falls below 5826.0
When Betting on a Market to Go Down Your Profits/Losses = (Opening Price – Closing Price) x stake per point
 
Trading Situation 3 The DAX 30 decreases and the spread betting market is revised and is set at 5783.1 – 5784.1.
Take Your Profit? You may choose to keep your spread bet open or close it, i.e. close your trade to lock in a profit. In this example you opt to close your trade by buying the market at 5784.1.
Your Profits/Losses = (Opening Price – Closing Price) x stake per point
(5826.0 – 5784.1) x £3 per point
41.9 points x £3 per point
Your Profits/Losses = £125.70 profit
 
Trading Situation 4 The DAX 30 increases and the financial spread betting market adjusts and moves to 5864.3 – 5865.3.
Limit Your Loss?At this point, you can opt to leave your position open or close it, i.e. close your spread bet to limit your loss. In this example you decide to close your trade and buy the market at 5865.3.
Your Profits/Losses = (Opening Price – Closing Price) x stake per point
(5826.0 – 5865.3) x £3 per point
-39.3 points x £3 per point
Your Profits/Losses = -£117.90 loss

DAX 30 Notes:

  • Online spread betting price obtained from FinancialSpreads as of 9 November 2011
  • You could also choose to spread bet on the DAX 30 in euros per point and dollars per point

Where to Spread Bet on German Companies

You can trade a selection of leading German firms with:

How to Spread Bet on German Sharese

As an example, let’s suppose that you are interested in speculating on Deutsche Bank, you go on a financial spread betting site, like IG, and they are offering the spread at:

Deutsche Bank Rolling Daily: €45.67 – €45.83

Here is what you need to know about how it works:

The Spread Trading Market Deutsche Bank Rolling Daily
The Spread Betting Quote €45.67 – €45.83
How the Trade Works Now you can speculate on the Deutsche Bank Rolling Daily market going:

  arrow_upward  Above €45.83, or
  arrow_downward  Below €45.67

This is a Rolling Daily spread bet and so there is no expiry date for this spread bet. If you decide not to close your position and the trading session ends then your trade will roll over to the next trading day.

Note that if a trade does roll over then you will normally either receive or pay interest for overnight financing based on the direction of your trade.

Units Traded Bets on the Deutsche Bank market are priced in £x per cent.

Where a cent is €0.01 of the German share’s price movement.

E.g. if Deutsche Bank moves by 50c (€0.50) then you would lose/win 50 times your stake.
Stake (Trade Size) You decide how much you want to risk per cent, e.g. £1 per cent, £5 per cent, £20 per cent etc.
Staking Example If, for example, you had a stake of £5 per cent and Deutsche Bank moves €0.22 (22c), you would lose or win £5 per cent x 22c = £110.


Worked Example | Taking a Long Position on Deutsche Bank

Spread betting on the equity to move up in value

You Now Choose Whether to Go Long or Short Deutsche Bank to go:

  arrow_upward  Above €45.83? or
  arrow_downward  Below €45.67?

Let’s Assume You Decide to Buy   arrow_downward  Above €45.83
You Choose How Much to Risk, Let’s Say You Select £2 per cent
So What Next?
  • You win £2 for each cent (€0.01) Deutsche Bank increases higher than €45.83
  • You make a loss of £2 for every cent (€0.01) Deutsche Bank moves lower than €45.83
If You Are Speculating on a Market to Go Up Your P/L = (Final Level – Initial Level) x stake per cent
 
Scenario 1 Deutsche Bank moves higher and the spread betting market is revised and moved to €46.45 – €46.61.
Time to Lock in Your Profit? At this point, you may opt to leave your spread bet open or close it for a profit. In this case you decide to settle your bet by selling at €46.45.
Your P/L = (Final Level – Initial Level) x stake per cent
(€46.45 – €45.83) x £2 per cent
€0.62 x £2 per cent
62c x £2 per cent
Your P/L = £124 profit
 
Scenario 2 Deutsche Bank pushes lower and the market is moved to €45.26 – €45.42.
Close and Restrict Your Loss? You could decide to keep your position open or close it, i.e. close your trade and restrict your losses. In this example you opt to close your position and sell the market at €45.26.
Your P/L = (Final Level – Initial Level) x stake per cent
(€45.26 – €45.83) x £2 per cent
-€0.57 x £2 per cent
-57c x £2 per cent
Your P/L = -£114 loss


Worked Spread Betting Example | Going Short of Deutsche Bank

Financial spread betting on the equity to go lower

You Now Decide to Buy or Sell Deutsche Bank moving:

  arrow_upward  Above €45.83? or
  arrow_downward  Below €45.67?

You Might Choose to Sell   arrow_downward  Below €45.67
You Decide Your Stake, Let’s Assume You Select £2 per cent
What Happens Now?
  • You make a loss of £2 for every cent (€0.01) Deutsche Bank pushes higher than €45.67
  • You win £2 for every cent (€0.01) Deutsche Bank pushes lower than €45.67
If You Are Selling a Market Your P/L = (Initial Level – Final Level) x stake per cent
 
Scenario 3 Deutsche Bank moves lower and the spread trading market is revised and is set at €45.11 – €45.27.
Close and Take a Profit? You may opt to leave your trade open or close it in order to lock in a profit. In this case you opt to settle your trade by buying the market at €45.27.
Your P/L = (Initial Level – Final Level) x stake per cent
(€45.67 – €45.27) x £2 per cent
€0.40 x £2 per cent
40c x £2 per cent
Your P/L = £80 profit
 
Scenario 4 Deutsche Bank rises and the financial spread betting market becomes €45.88 – €46.04.
Time to Restrict the Loss?At this point, you can opt to let your trade run or close it, i.e. close your position and limit your loss. In this example you decide to settle your bet by buying at €46.04.
Your P/L = (Initial Level – Final Level) x stake per cent
(€45.67 – €46.04) x £2 per cent
-€0.37 x £2 per cent
-37c x £2 per cent
Your P/L = -£74 loss


Deutsche Bank Notes:

  • Financial spread trading price obtained from Capital Spreads on 25 January 2010
  • Most spread betting companies will also allow you to trade on Deutsche Bank in euros per cent and dollars per cent

AuthorAlex Turner

Senior Editor, SpreadBetMagazine

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