The DAX index is a German equity index comprised of 30 stocks that trade on the Frankfurt stock exchange. The DAX was introduced in December of 1987 and has a base value of 1000. In the last quarter of 2004 the DAX had a current value of 4,063, a 306 percent increase in value over the 16 years of its existence.

Though the stocks that comprise the DAX index trade on the Frankfurt stock exchange you can trade the index through some of its derivatives. These derivatives include exchange traded funds (ETF), futures, and stock options. The derivatives are traded mainly through the Eurex exchange. The Eurex exchange is an exchange that trades DAX derivatives through electronic networks (ECN).

Exchange traded funds are similar to mutual funds but they are traded throughout the trading session. The ETF is intended to closely mimic the action in a selected index by investing in the same stocks that comprise the index. Index futures are used by investors to capitalize on the markets move with a single trade and high leverage. Index futures are contracts that promise the buyer a delivery of cash equal to the value of the index at expiration. One can use stock options to trade the 30 stocks that make up the DAX index.

DAX Components

Currently there are 30 stocks that are the DAX index. The value of the index is based upon the prices through the Xetra electronic network. The components of the index can change similar to U.S. indexes like S&P 500 and DOW Industrials. A list of the 30 components can be found at a variety of different financial websites like Yahoo! Finance and Bloomberg.