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What Is the DAX

The DAX is the index of the forty largest companies on the Frankfurt exchange, weighted by size, priced in euros, and unusual in counting dividends back into the number, so that it climbs faster than a price index of the same shares. This paper shows you the DAX in five lines; the idea as the Frankfurt skyline with the exchange at its foot; the dividend counted back in, drawn against a price index; the exchange's hours and the CFD's hours in Frankfurt time; and DE40 on your platform, where the Profit currency line says euros.

Difficulty
Intermediate
Reading time
5 min
Pages
8
Reviewed by
Saman Rahbar

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The DAX, in five lines

The DAX is the index of the forty largest companies on the Frankfurt exchange, thirty of them until 2021. It is weighted by size like most indexes, and it is a performance index, which almost no other big index is: when a member pays a dividend, the DAX counts it back in rather than letting the number drop. The number is in points and in euros, 20,000.00 as a round example, since this library holds no DAX bars. The exchange, Xetra, trades from 09:00 to 17:30 Frankfurt time; the CFD on a platform trades far longer, where a CFD is a contract on the price difference rather than the shares. It appears as DE40, GER40 or DAX40, one lot is one index, and the profit arrives in euros.

The Frankfurt skyline

Picture the Frankfurt skyline, the one German city with a wall of towers, because the banks and the exchange are there. The low building with the pediment is the Börse, the exchange, and the DAX is the number it publishes every second of the trading day: forty companies from all over Germany, carmakers, chemical firms, insurers, software, added up where the towers are. The same city holds the European Central Bank, which has its own paper in this library.

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