DAX or GER40 as it is also known is one of the most actively traded European indices. It tracks the performance of the 40 biggest blue-chip companies listed on the Frankfurt Stock Exchange (FSE). As the index takes into account market cap and liquidity, it is considered a reliable gauge of the German economy’s current state. Unlike pure price-weighted indices, the DAX embraces information about dividends, cash outflow, and capital income and does not disregard corporate distributions.
What is specific about the DAX index is that a free-float methodology is used for its calculation. The market capitalization of the constituent companies is equal to the equity price multiplied by the number of readily available shares. That is to say, untradable shares such as those held by governments, are excluded.
How DAX Trading Works for Traders and Brokers
Given the constituents of the DAX and the specific way it is computed, it is not surprising that the index enjoys great interest both by retail and professional traders as well as by major trading brokers that operate all over the world. It is in the interest of the latter to provide their customers with as many different options as possible in terms of account types and trading platforms.
It is a brokerage’s common approach to feature a standard account and at least one that is more specific. The first type usually comes with zero commissions as all trading costs are incorporated in the respective spreads. Due to their simplicity and convenience, these are the accounts used by the largest number of traders. On the other hand, those users who are professionally oriented and operate on a daily basis, prefer tighter spreads in return to which they are ready to pay certain fees and commissions.
How to Trade the DAX Index?
In this respect, DAX40 does not differ much from the other popular stock indices. Theoretically, there is the possibility of investing in or trading the individual components of the index. However, such a practice bears more difficulties and inconveniences than benefits. It is for this reason that over time some derivative trading products have been formed that allow for operating with a basket of stocks simultaneously rather than executing separate trades on the stocks of individual companies. DAX trading brokers offer three main ways to operate with the index:
- DAX Futures – futures contracts obligate the buyer and the seller to transact the subject of the deal at a predetermined price on a particular date. The preset price is not amendable, i.e. even if the current market value is more profitable, you have to buy or sell at the price stated in the contract.
- DAX CFDs – here subject to trading is the difference between the settlement prices of the open and closing trades. When traders expect a certain price to move up, they will buy the CFD. Conversely, if a downward price movement is expected, traders will try to sell.
- DAX ETFs – in their essence, exchange-traded funds represent a pooled investment security that tracks the index performance. The name comes from the fact that ETFs can be traded on exchanges the same way as stocks. In most cases, exchange-traded funds come with lower average fees than mutual funds.
Top DAX Trading Brokers
Profitable DAX trading requires you to find a reliable brokerage company that aligns with your expert level, trade goals, and operating manner. Of course, no broker is capable of providing you with sure-fire fund returns but the closer it is to your needs and preferences, the better chance of performing fruitful DAX deals. To facilitate your choice, tradingpedia made a selection of ten trustworthy trading brokers giving you useful info about the platforms and the applicable spreads, fees, and commissions.
- 1. AvaTradeMin Deposit$100FeesOvernight fees:
CommissionsNoneSpread1.5Leverage EU20:1Leverage non-EU200:1CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
AvaTrade is a well-known name in the trading world since it is one of the first brokerage entities that was made available to retail traders. Over the more than 15 years of its existence, the company has gained a reputation of a reliable trading broker that puts individual customer needs at the forefront. Add to that the fact the customer care service is available in almost 40 different languages and you will have no reasons to wonder why AvaTrade ranks high in end-user reviews.
As regards newcomers to the retail trading field, this trading broker has a lot to offer. There is a huge selection of educational tools, guides, and explanations, as well as video tutorials, analytical articles, and a specialized blog. We decided to quickly cast an eye on reviews about AvaTrade on the Trustpilot platform. The broker has a 4.8 overall score out of 5.0 with most users talking about flawless communication with customer support.
AvaTrade gives its clients the chance to operate with a trading platform that fits their preferences and requirements by offering quite a few options. The company has developed a proprietary platform, WebTrader, which does not need to be downloaded and runs smoothly on most modern devices. It has a simple and easy-to-use interface with all crucial functionalities incorporated. However, experienced traders usually opt-in for MT4 or MT5 as they offer a greater number of indicators, order types, charting features, and others.
- 2. FBSMin Deposit$1Fees
Commissions0%Spread4.1 (avg.)Leverage EU20:1Leverage non-EUUp to 33:1Risk warning: ᏟᖴᎠs are complex instruments and come with a high risk of losing money rapidly due to leverage.76.5% of retail investor accounts lose money when trading ᏟᖴᎠs with this provider.You should consider whether you understand how ᏟᖴᎠs work and whether you can afford to take the high risk of losing your money.
- Swap long: -77.51
- Swap short: -137.45
Having united quite a few independent companies under its umbrella, nowadays FBS is a truly global trading brokerage. In 2019, it was announced as the “Most Progressive Forex Broker Europe” by the International Business Magazine. The brand boasts of serving 23,000,000 traders residing in more than 150 countries. However, as regards region coverage, there are some notable absentees – Japan, the US, Canada, and the UK among others.
Given the profusion of account types provided by FBS, we can safely say that the broker has something to offer to any type of trader, whether he is retail or professional or a complete newbie. The whole set of FBS accounts includes Cent, Standard, Crypto, Micro, Zero Spread, and ECN. Of these, only the first three in the list are available for EU-based traders. Each of the available options has a demo version so you can first cotton on to the specifics of trading with it and then move to a real account.
If you аre hesitant about which account to opt for, look at the respective pricing and decide if it is acceptable for you. The required minimum initial deposit varies between $1 (Standard) and $1,000 (ECN) and all accounts except for the Zero Spread come with floating spreads.
- 3. XM GroupMin Deposit$5Fees
CommissionsNoneSpread1.0Leverage EU20:1Leverage non-EU200:1*Deposit and withdrawal methods depend on availability and client’s country of residence.*Trading bonus are not eligible for clients registered under Trading Point of Financial Instruments Ltd.*CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.07% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please consider our Risk Disclosure.
- Swap long: -0.87
- Swap short: -1.29
There was no way to skip XM while compiling this selection of reliable DAX trading brokers. The brand is among the brokerages that enable commission-free and/or zero-spread trading. What is more, XM requires a minimum deposit of just $5 for all its account types which makes it one of the most affordable entities in the online trading landscape. Users can make deposits in USD, EUR, GBP, JPY, CHF, AUD, HUF, PLN, RUB, SGD, and ZAR – diversity, which is rarely seen in competing brands.
Except for Germany 40 and the other thirteen indices on the platform, XM’s clients can trade stocks, commodities, precious metals, energies, and others. Traders can operate with the whole set of financial instruments no matter which of the three account types they use – Micro, Standard, or XM Zero. Standard accounts are the most widely used option by XM’s retail customers. They, as well as Micro accounts, come with no commission while holders of XM Zero accounts pay a commission of $3.5 per lot in exchange for spreads as low as 0 pips.
Just like an increasing number of other trading brokers around the globe, XM offers its clients the opportunity to open an Islamic account. It is designed in a way that is compliant with the Muslim faith, i.e. there is no accumulation and payment of interest fees.
- 4. FP MarketsMin Deposit$100FeesOvernight interest (Daily):
CommissionsNoneSpreadFrom 0.4Leverage EU20:1Leverage non-EU20:1Trade Responsibly: Derivative products are highly leveraged, carry a high level of risk and are not suitable for all investors.
- Sell: -0.75%
- Buy: -1.14%
FP Markets is a prominent online trading broker that provides its international clients with more than 10,000 CFD products on GER40 and other major indices and also on metals, cryptos, commodities, Forex, and bonds. A range of user-friendly trading platforms is available to traders via desktop, in-browser, and downloadable versions. The brokerage is regulated by ASIC and CySEC and has offices in Australia (Sydney), Cyprus (Limassol), and Saint Vincent and the Grenadines (Kingstown).
Among the high points of FP Markets is that it offers a selection of reliable desktop and mobile trading platforms so that its users, regardless of their expert level, can find a suitable option.
- MetaTrader 4 is often described as the choicest platform for CFD trading. It is characterized by pre-installed indicators, customizable charts, profile templates, and last but not least – one-click trading.
- MetaTrader 5 is the boosted version of MT4 with its distinctive features being algorithmic and automated trading and real-time market news and analytical publications.
- IRESS is a platform with an intuitive layout designed with multi-product trading in mind. News and alerts are sent in real-time by email, SMS, or directly through the platform.
Inexperienced users of FP Markets can take advantage of the copy trading functionality of the brokerage. The system rates traders according to their profitability over a certain period of time and all you have to do is select one or more top-performing users and follow their practice.
- 5. Markets.comMin Deposit$100FeesOvernight interest:
CommissionsNone on CFDsSpread1.2Leverage EU20:1Leverage non-EU200:1CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
- Buy: -0.0104%
- Sell: -0.0104 %
If you are in search of a reliable index trading broker with a wide range of trading platforms and competitive spreads, Markets.com is definitely an option worth considering. The company was established in 2008 as part of Finalto Ltd. and has since built a reputation as a competent and innovative brokerage entity.
A highly valued aspect of Markets.com’s operation is that the brand has implemented several protective measures to ensure its clients will rest assured about the security of funds they spend through the brokerage. Retail traders’ money is held in independent trust accounts with zero possibility of merging with the broker’s assets. In addition, part of the customer support team has the obligation to monitor for irregular payments and other unusual activities.
Markets.com offers diverse CFD trading opportunities on indices, currencies, commodities, bonds, shares, ETFs, blends, and cryptos. The indices section has Cash and Futures subsections as Germany 40 we find only in the first. The trading platforms you can choose from after joining Markets.com are the proprietary Web Trader as well as MetaTrader 4 and MetaTrader 5. Keep in mind that the in-house developed platform is not available to users outside the EU. Fortunately, this does not apply to the broker’s mobile applications which can be used regardless of your current location.
- 6. AxiMin Deposit$0Fees
CommissionsFrom $0SpreadFrom 1.0Leverage EUUp to 30:1Leverage non-EUUp to 500:1Over-the-counter derivatives are leveraged products that carry a high level of risk to your capital. Trading is not suitable for everyone and may result in you losing substantially more than your initial investment. You do not own, or have any rights to, the underlying assets. You should only trade with money you can afford to lose.
- Swap long: -2.5
- Swap short: -3.5
Axi is a well-regulated trading broker with over 90% positive customer feedback. The company has focused its operations mainly in the UK and Australia but is gradually enlarging its user base with traders from different parts of the world. Currently, the brokerage is officially regulated by the Australian Securities & Investments Commission (ASIC), the Financial Conduct Authority (FCA) in the UK, the Financial Markets Authority (FMA) in New Zealand, and the Financial Services Authority (FSA) of Saint Vincent and the Grenadines.
The key advantages of trading with Axi are fast execution speeds, low spreads and commissions, and a selection of powerful trading tools. For a modern online trading broker who relies on third-party platforms, the absence of MetaTrader 5 is slightly perplexing. Axi has chosen the approach to work only with MT4 which is available for desktop usage as well as in the form of an in-browser app and downloadable trading application.
Apart from the well-known and highly valued features of MetaTrader 4, Axi has taken care its users to have access to some additional tools that come with the platform – Autochartist, PsyQuation, and MT4 VPS hosting. MT4 NexGen also falls within this category. Its characteristics deserve a separate review so now we will only say that MT4 NexGen is a kind of unique set of plugins exclusively developed for Axi’s clients. And as we know, a customer who feels special is a satisfied customer.
- 7. CMC MarketsMin Deposit$0FeesHolding costs:
CommissionsNone on indicesSpreadFrom 1.0Leverage EU20:1Leverage non-EU20:1Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
- Buy: 0.0066%
- Sell: 0.0098%
Established back in 1989, CMC Markets is a competent and well-regulated trading broker that provides high-quality services in two main directions – CFDs and spread betting. Among the assets tradable through the brokerage’s desktop and mobile platforms, there are over 80 cash and forward indices, including the DAX. Spreads for Germany 40 start from 1.0 with the margin rate being 5% as the prevailing part of the other indices.
One of the reasons why CMC Markets ranks high when it comes to end-user reviews is that the broker focuses on its customer care service and a range of educational offerings. Its LEARN division features separate sections for forex, cryptocurrency, and CFD trading accompanied by additional trading guides and quite frequently conducted webinars and other events.
Traders who set up accounts with CMC Markets have the opportunity to trade either via the in-house developed Next Generation platform or through the still popular third-party proposal – MetaTrader 4. The proprietary trading platform features a client sentiment functionality that shows how many traders have bought and how many have sold a certain product so that you can estimate the overall expectations. If you want to follow the example of best-performing traders, you can filter the data shown by using the “Top Clients” view. Other tools provided by the Next Generation platform are pattern recognition and price projection.
- 8. SpreadExMin Deposit$0FeesNoneCommissionsNoneSpread1.4 - 6.0Leverage EU20:1Leverage non-EU200:1Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68.8% of retail investors lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
SpreadEx is an award-winning European brokerage company with rich market coverage including indices, shares, Forex, commodities, and others. The information about the DAX index is understandably presented so you do need much time to assess whether pricing and other conditions suit your preferences and manner of trading. A reference to the broker’s website shows no minimum deposit requirement, no indices-related commissions, and spreads for Germany 40 of between 1.4 and 6.0.
Although SpreadEx’s proprietary platform is not difficult to operate with, it is probably not the best choice for novice traders as it does not provide a demo account that represents the easiest way to get a sense of a certain trading broker. However, several protective functionalities allow for managing your risk when trading with the company – “Stop Losses” and “Guaranteed Stop Losses”. In brief, these enable closing a position in case the respective market moves against you.
The three main currencies accepted by SpreadEx are GBP, USD, and EUR. This does not mean it is impossible to open an account with your native currency, though. The brokerage states that it is open for requests in this relation on a case-by-case basis. For further details on that issue, you can contact customer support by phone or email.
- 9. IGMin Deposit
- $0 - bank transfers
- $300 - card payments
CommissionsFrom 0%SpreadFrom 0.8Leverage EU20:1Leverage non-EU200:1Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Options and turbo warrants are complex financial instruments and your capital is at risk. Losses may be extremely rapid.Professional clients can lose more than they deposit.The value of shares, ETFs and ETCs bought through a share dealing account, can fall as well as rise, which could mean getting back less than you originally put in. All trading involves risk.
- Overnight funding admin fees: 2.5 - 3%
- Guaranteed stop premium: 1.5
IG is a trustworthy brokerage brand with almost 50 years of experience. Having the ambition to maintain a legitimate global operation, the IG group of companies has taken care to get regulation by quite a few reputable authorities. Currently, the active licenses are issued by the Financial Conduct Authority, the Bundesanstalt für Finanzdienstleistungsaufsicht and Deutsche Bundesbank, the Finansinspektionen, and the Commodities Futures Trading Commission.
IG’s portfolio is among the most varied in the industry. The broker offers as many as five different ways to perform DAX trading – Turbo24s, spread betting, Barriers, CFDs, and Vanilla options. With so many alternatives in front of you, there is surely at least one that will fit your level of expertise.
We also observed a wide choice in terms of the trading platforms provided by IG. As regards the opportunities for desktop trading, clients of the broker can use the software-based MetaTrader 4 platform, the advanced ProRealTime charting package, the DMA platform L2 Dealer, and PWA (progressive web app). On-the-go traders are not neglected as well since they may use IG’s proprietary mobile trading application that is suitable for spread betting, CFD, and share trading. The application was announced for Best Finance App at the 2021 ADVFN International Financial Awards.
- 10. FXTMMin Deposit$10FeesFrom $0CommissionsFrom 0%SpreadFrom 1.5 (floating)Leverage EU5:1Leverage non-EUUp to 300:1CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Although not the most experienced player in the online trading field, FXTM has rapidly grown over the past decade and today welcomes more than 4,000,000 traders from different parts of the world. The brokerage has backed up its large-scale operations with licenses issued by the Financial Conduct Authority (FCA), the Cyprus Securities and Exchange Commission (CySEC), the Capital Markets Authority of the Republic of Kenya, the Financial Services Commission of the Republic of Mauritius, and the Financial Sector Conduct Authority (FSCA) of South Africa.
This DAX trading broker offers three types of accounts in an attempt to meet the requirements of as many traders as possible. Micro accounts are intended solely for the users of the MT4 platform and come with a minimum deposit of as low as $10. This is an excellent option for novice traders who want to see how the land lies without risking too much money. Spreads are tight and there is no commission. Unfortunately, index trading is not enabled with Micro accounts.
DAX traders have the option to operate through Advantage or Advantage Plus accounts where the financial threshold is much higher, $500. The difference between these two account types lies in the charged spreads and commissions. Advantage Plus users have to pay wider spreads in exchange for zero commission.
DAX (Germany 40) FAQ
1. What does DAX index family mean?
2. What happened with the GER30 index?
3. When can I trade the DAX (Germany 40)?
4. How do I start trading the DAX index?
5. Which are the Top 5 DAX companies?
- Deutsche Telekom