An Index tracks the performance of a large group of stocks. Indices trading provides a great way to speculate on the performance of each overall stock market, as opposed to selecting individual stocks and shares. In fact, indices are often viewed as being less of a risk than trading individual stocks, as you are spreading your risk across the whole market rather than on a single stock. This allows for diversified exposure as most of the factors that affect individual stocks are taken out of the equation. If you believe the FTSE 100 in the UK is going to do well, there’s a leveraged cryptocurrency trade that allows you to profit when it does; if the Dow Jones Industrial Average looks set for another fall, you can trade that for a profit too.
By taking a leveraged cryptocurrency position, a trader is essentially agreeing to exchange the difference in price of an index from one time period to another. Indices are available to cover all the key indices around the world, which allows the trader in one country to take part in the world markets.