Dax Futures

Written by Jacey Harmon
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The Eurex exchange offers futures contracts on the German DAX index. These futures follow the value of the 30 stocks that comprise the DAX composite. An individual trader can utilize the futures contract to profit from expected price swings in the DAX index. Institutional investors often utilize futures contracts to hedge their portfolios against unwanted risk.

Index futures contracts work by promising to deliver the cash value of a selected index on a certain date. Similar to commodities futures, index futures are traded in time periods with terms of expiration. Each futures contract trades in minimum ticks that change the value of a selected contract.

DAX Futures Trading in the United States

The DAX futures contract is one of the few Eurex futures available for trade in the United States. The popularity of the DAX futures contract for American investors is easily understood. The bear market in between 2000-2002 created increased regulation for day traders in the United States as many were unprepared for a down market. The DAX Futures offer U.S. investors a highly volatile, less regulated trading platform than most U.S. markets and derivatives.

The availability of trading DAX futures is also a reason why U.S. traders are using DAX contracts. Between the trading in the United States and Europe there is a 21 hour trading window for traders to utilize. This long trading session allows many traders the ability to keep their day job while still actively trading the DAX. Trading the DAX contract is very volatile and requires the assistance of a trading program or broker for all but the most experienced traders.


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