Contracts for Difference (CFDs) allow investors to potentially profit from both up and down moves in market prices.
When you want to go long and potentially profit from upwards moves on these indices, it’s as simple as clicking the buy button. If you want to go short because you think prices will fall, you just click the sell button.
Capital.com is pleased to be expanding its offering, adding eight new equities indices on which users will be able to take long or short positions.
Let’s take a look at these new additions to get a flavour of the opportunities on offer.
The FTSE China A50 index is comprised the largest 50 “A-share” companies by market capitalisation of companies listed on the Shanghai and Shenzhen stock markets.
A-shares simply refer to the shares of mainland China-based companies, which until 2003 were only open to investment from mainland Chinese residents. These days, however, foreign institutions can invest in such companies through the government’s Qualified Foreign Institutional Investor (QFII) initiative.
Part of the FTSE family of indices, the China A50 is heavily weighted towards companies in the financial sector. Banks are by far the largest grouping, making up around 33% of the index, followed by insures, which comprise 14%. Food & beverage is the next largest grouping, with 11%.
Insurer Ping An Insurance is the largest single constituent, representing just over 11% of the index. This is followed by banking name China Merchants Bank (6%), beverages company Kweichow Moutai (6%), banking group Industrial Bank (4%) and real estate firm China Vanke (6%).
Over the past five years, to the end of March 2018, the China A50 has risen by 84%. The index, however, is still a long way off the peak level it reached in October 2007, at the onset of the global financial crisis, when it stood at over 23,000 points.
The China A50 currently stands at just over 12,000 points.
The FTSE MIB index is the most widely followed Italian stock market benchmark.
Representing around 80% of Italy’s stock market capitalisation, the FTSE MIB is comprised of what are deemed to be the country’s largest 40 publicly-listed companies, taking into account both capitalisation and liquidity.
The index also seeks to replicate the sector weights of the Italian stock market. FTSE Russell ensures that no one stock comprises more than 15% of the total index weighting. If a constituent does have a natural weighting of more than 15%, then FTSE will cap that particular stock at 15%. The weights of smaller firms in the index are then increased accordingly.
FTSE conducts a review to decide any changes that are needed to the constituent firms in the index each quarter, in March, June, September and December. As at the end of December, utility group Enel was the largest constituent, comprising around 12% of the index.
In order of ranking, this was followed by banking names Intesa Sanpaolo (11%) and UniCredit (10%), oil & gas producer Eni (10%), and insurer Generali (6%).
Over the past five years, to the end of March 2018, the FTSE MIB has gained 46%.
The Netherlands 25, or AEX as it is also known, is the most commonly cited index of Dutch equities, representing the performance of 25 of the largest and most actively traded Netherlands-listed companies.
Operated by Euronext, the composition of the index is reviewed on a quarterly basis, in March, June, September and December. One of the main rules that Euronext applies is to cap individual constituents’ weightings at a maximum of 15% of the index.
As at the end of March 2018, the largest member of the index was oil & gas company Royal Dutch Shell (15%), followed by consumer goods firm Unilever (14%), semiconductor equipment manufacturer ASML (13%) and banking group ING (14%). Some way behind, the next largest constituent is healthcare name Philips Kon (5.6%).