DAX 40 – Complete Guide

The DAX 40 is the main stock index of the German stock exchange, and one of the most followed on the European scene. Despite its particular performances, it is an index which is still little known to the general public. It is this index that we will focus on today.

DAX 40 (GDAXI) Quote and Price in Real Time

DAX 40 Index Equity Performances

DAX 40(GDAXI) Price Compared to Other Indices

What is DAX 40? – DAX Stock Exchange Definition

The DAX 40 is the main stock index of the Frankfurt Stock Exchange, it is also the main index of the German financial market. The acronym which stands for Deutscher Aktien IndeX is the second largest financial center in the world. It is an extremely liquid market and its assets are very volatile, which offers very large trading opportunities and also a fairly high level of risk. Here is our complete article on DAX 40 definition.

What is a GER 40 Index CFD?

Also called contract for difference in English or contract for difference, it is one of the most traded financial instruments in the world. It is a contract in which the variations in value of an underlying asset are negotiated.

It is a financial product that can be derived from all the financial instruments available in the markets. CFDs are therefore a very popular form of trading on the DAX 40. In simple terms, CFDs on DAX 40 are a financial product derived from the variations in value of the DAX.

With CFDs on DAX, you don't need to own DAX units or shares to profit from them. This is also one of the main ways to invest in the index after stocks.

DAX 40 Index – Trade the German Stock Exchange in

The DAX 40 is the main stock market index of the Frankfurt Stock Exchange. It is an important index compiled by 40 large German companies and multinationals. It is not misused to say that this index represents the European economic health. It represents the thirty largest companies by market capitalization listed on the Frankfurt Stock Exchange.

The DAX 40 experienced tremendous growth during the first years of its existence, growing from 2000 to 7 points between 500 and 1993. Over time, other indices joined the DAX such as the MDAX and TecDAX respectively represent the 50 largest German companies after those of the DAX and the 40 largest German Technology companies.

How Does the DAX 40 Work?

It is not possible to buy the DAX 40 as is the case with stocks, because it is only a numerical representation of the data of the companies listed on it. To trade on the DAX 40, the best alternative remains contracts for the future, CFDs.

CFDs on DAX 40 are financial products derived from the price movement of the DAX 40 on the market. It is a trading system which gives the possibility of trading instruments on stock exchanges without actually owning them. CFD trading is one of the most fashionable and vulgar systems.

DAX 40 for Beginners

We hear about the DAX 40 when we enter the financial markets, already because of its importance, but also because of the opportunities there are to trade there. For novices, it's not always easy, they still have everything to learn. This is the reason why we will approach the subject in simpler terms.

Simply, the DAX 40 is an index representing the 40 largest publicly traded German companies. It is not accessible like stocks so the best way to invest in it is through CFDs. With the evolution of technology, it is no longer enough to trade the DAX 40.

DAX 40 Index Quotation – German Stock Exchange

The DAX 40 is calculated by reinvesting dividends and other premiums and bonuses paid to shareholders, unlike indices such as the CAC 40. The stock market quotation is decisive and important in a market for goods, services or financial assets. This is the moment when the purchase price and the selling price are fixed on the market, on the one hand between the sellers and on the other hand between the buyers.

Several markets now have live quotation systems, giving the possibility of seeing live prices and their various variations. To see the quotation of the DAX 40 stock market index, you can open an account with a broker that offers the index.

What is a DAX 40 Index Pip?

A pip is the variation or difference between the index point, also called the starting point, and the current price. For CFDs on indices, one pip can be equal to 1.0 points. For a DAX CFD whose index point is 1.6574 when the position is opened and 1.6589 when the position is closed, the position will be said to have changed by 15 points.

Example Pips on DAX 40 index.

You trade DAX CFDs at Ava Trade and open a position at 1.5625. After 5 hours, you realize that prices are at 1.5867. If you had opened a position on the rise, you would realize a margin gain of 1.5867 – 1.5625 = 242 pips. However, if your position was open to selling, you would realize a margin loss of 242 pips. These gains will then be converted into currency based on your lot size and leverage.

What is a DAX 40 Index Lot.

Unlike forex CFDs, lots on indices are not standardized, so the lot depends on the value of the asset on the stock exchange. When the DAX is worth 15 points, a lot is worth €000, a mini lot will be worth €15 and 000 for a micro lot.

The lot on DAX CFDs is the current value of the DAX 40 on the exchange.

DAX 40 Key Information

Opening and Closing German Stock Exchanges?

• Monday 9:00 a.m. – 17:30 p.m.;
• Tuesday 9:00 a.m. – 17:30 p.m.;
• Wednesday 9:00 a.m. – 17:30 p.m.;
• Thursday 9:00 a.m. – 17:30 p.m.;
• Friday 9:00 a.m. – 17:30 p.m.

However, it is possible to trade the DAX 40 between 8 am and 9 am in the morning and between 17:30 pm and 22:00 pm in the evening. This provision is put in place to allow traders to trade the Early DAX and Late DAX. It is therefore possible to trade the component shares of the DAX 40 during these different opening hours.

The DAX 40 is also open at night to allow investors who spend the day at work to trade with complete peace of mind. You can therefore have overnight trading sessions on DAX 40 shares and CFDs.

When does the Frankfurt Stock Exchange close?

Outside of evening closing hours, the DAX closes on other days of the year and in 2026, the public closing holidays on the DAX 40 are:

• Friday 01 January for New Year's Day
• Friday, April 2 for Good Friday
• Monday, April 5 for Easter Monday
• Monday, May 24 for Pentecost
• Friday, December 24 for Christmas
• Friday, December 31 for New Year's Day. 

Which Financial Instruments to Trade with the DAX 40?

The DAX 40 is a stock market index. As a result, it is impossible to buy it, to own it. To carry out a profitable trading there, one wonders what financial instruments can we trade there.

• CFDs On DAX 40

CFDs are financial products derived from variations in the value of an underlying financial index. Simply put, it's trading based solely on the price action of an asset you don't own. It is therefore possible to trade CFDs on the DAX 40. This is the most widespread and modern form of trading CFDs on the DAX 40.

• Major Stocks – Composition of the DAX 40

1. Deutsche Telekom stock: with a potential upside of 30%, this is the stock of one of the largest companies listed on the DAX 40, with a market capitalization of €82,2 billion. This stock benefits from a buy recommendation from the majority of analysts.
2. Fresenius SE shares: with a potential upside of 28%, the stock is worth approximately €68,40 to buy and €45,27 to sell this Wednesday. Its market capitalization is then €30,7 billion. Analysts are advising to sell a third of the shares in their latest analyses.
3. E. ON stock: the German technology giant has a potential upside of 23% with a market capitalization of 26,69 billion euros.
4. Action Volkswagen: The German automotive giant has an upside potential of 22%. The manufacturer has only one sell recommendation compared to 19 buy recommendations.
5. Bayer stock: the company's share price offers a potential upside of 20,52% for buying.

Although it is not possible to hold DAX, it is possible to hold stocks that are part of the DAX 40 composition. All of the companies that make up the DAX 40 are potential stocks that can be traded. However, we offer you the list of the 5 major stocks of the DAX 40.

• Future DAX 40 FDAX1

The DAX is updated at the same time as the futures contracts for the following days. It is also one of the instruments you can trade on the Frankfurt Stock Exchange. A futures contract is a contract in which the purchase or sale price of a financial asset is fixed for subsequent delivery.

German stock market news

When trading the DAX, it is important to stay informed about new trends and new information that will influence the prices of the instrument. The best way to get news on an instrument is to open an account to trade the instrument, this rule also applies to the DAX. The brokers with whom you open your accounts send you real-time information on all the assets you choose to trade.

You can therefore open an account with eToro or at Ava Trade, these are brokers suitable for trading on the DAX.

How to Invest in DAX 40?

It is possible to trade the DAX 40 in the form of derivative products or directly buy the shares of one of the DAX 40 companies. Indeed, the DAX is an index and therefore cannot be held. The derivatives trading format is a very common trading format, it is the most practiced and most modern form of the moment.

There are therefore 40 large German companies that make up the DAX and whose shares are available on the financial markets and accessible to everyone.

For profitable trading, you must take care to choose a broker that is well regulated, experienced and offers options for trading.

When to invest in the DAX 40?

It is important to know the best times to trade on DAX. Trading at an opportune time can be veryvantageux for the trader, however, trading off-time can also be fatal.

You can then open positions one hour after the markets open and make sure to close them one hour before the end. Throughout the day, trading is intense, the market is liquid, and prices are quite volatile. A good market analysis will therefore guarantee a positive outcome in this situation.

However, you have to be careful and not open a position During pre-market trading or before a major economic announcement. In pre-market trading, traders are still drawing on the previous session's performance to prepare for the upcoming session. Economic announcements, on the other hand, may not be favorable to the forecasts that led to the position being taken, and you then realize losses.

Why Invest in the DAX 40 [userip_location type= »country »]?

The DAX 40 is one of the main stock indices in the world, it is the second largest stock index in the world by market capitalization and the Frankfurt Stock Exchange is one of the world's leading financial centers. Its liquidity and volatility provide plenty of trading opportunities.

What DAX 40 Trading Strategies?

• Trading divergences on the DAX 40: Divergence patterns offer numerous trading opportunities. Developing a strategy based on divergence patterns on the DAX is a smart move; you just need to consider all the relevant factors. As the name suggests, a divergence often occurs between the price action on the chart and the forecasts of technical indicators. This situation generally marks the beginning of a trend reversal and presents a great opportunity to open positions.
• Morning trading strategy on the DAX 40: Morning trading is a strategy that involves opening positions very early in the morning before the markets open and closing them just before the close. It requires the trader to observe the market throughout the trading session; it is a strategy well-suited to day trading. This strategy is based on trend following and requires placing a stop-loss order to protect the position from unforeseen events.
• Opening positions at favorable times and trading volatile markets: avoid opening positions in pre-market phases and before economic announcements.
• Place stop-loss orders for every open position: this is a crucial safety measure and an important constant in money management. This measure provides protection against unforeseen events.

It is essential to adopt a well-developed strategy when trading the DAX 40. Given its degree of volatility, trading the DAX can be profitable but also very risky.

Best Indicators for Trading the DAX 40?

Technical indicators are tools available on trading platforms that allow you to analyze the prices of financial assets on the stock market. One of the most used, most complete and most effective is theIchimoku. This is an indicator that allows you to trade the DAX effectively by offering you the possibility of having the most accurate forecasts.

In a downtrend market with upside resistances, you can see the tenkan still breaking through the clouds. This indicates the strength with which investors are looking to reverse the trend. In extended trends, you will not see this movement, and then you can conclude that the bearish movement is strong enough to maintain the trend.

In cases where the tenkan crosses the cloud, you can understand that you are in a trending market that can change direction with a little effort. We must therefore be careful with this type of scenario.

The Ichimoku is quite effective and can give you good analysis on trending markets, however, you have to be careful of consolidating markets.

DAX 40 Index Chart Analysis Technical Indicators

Whether it is the DAX or any stock index like the BASF, the best analysis tools remain oscillators. Most often, market-derived functions detect market stress. Thus, with oscillators, we can easily see at what voltage purchases and sales are evolving, and also see the levels of oversales and overboughts. To trade the DAX 40, a few indicators are best recommended.

• Trading with the RSI: the acronym stands for "Relative Strength Index." It's a technical analysis indicator, introduced in 1978, that measures price trends in a financial market. It's a highly recommended indicator for trading indices, especially the DAX, because these assets generally move in a trend and experience little consolidation.
• The MACD on the DAX 40: This is a popular and easy-to-use oscillator. The acronym stands for "Moving Average Convergence Divergence," which represents the moving average of convergences and divergences. As its name suggests, it is very useful for strategies based on convergence and divergence. It is an indicator that helps identify trends and anticipate price movements.

DAX Fundamental Analysis

Fundamental analysis is an analysis based on the collection and processing of macroeconomic data. These data can be the evolution of the interest rate of a central bank, information in relation to the evolution of the unemployment rate of a given economy. Fundamental analysis aims to forecast the impact of an immediate economic situation on future economic growth.

The news from the German economy has had a rather positive influence on the DAX price development over the past few days. With an evolution of orders in German industries, there is no longer any need to search too much to understand the growth that the index has experienced over the past few days.

The Economic Calendar

It is an essential tool in fundamental analysis and especially for trading stock indices. It is a tool that allows you to predict market developments. Economic announcements are very important, they are an important asset for trading stock indices. When you follow the German stock market, you can focus on information affecting commodity demand, energy or the pharmaceutical sector.

History of the DAX 40

• The DAX is the benchmark index of the German financial market, it is a benchmark index that often reflects the economic situation of the country, and sometimes even of the entire euro zone. It went public at the end of the 80s with a value of 1000 points, and since then has experienced mergers, bankruptcies, in short, the routine life of any stock market index.
• Between 2003 and 2007, the DAX marked the spirits by more than 1500 days of rise, which enabled it to rise to a value of more than 8 points. Like any other stock market index, the DAX will experience a drop in 100 approaching a floor of 2009 points before resuming its ascent. Today, at over 2500 points, the DAX is one of the most important stock market indices in the world.
• The DAX is then the stock market index of the largest German companies and the overall image of the European economy.

History of the DAX 40

To find out how the DAX 40 stock market index can evolve in terms of price and composition, it is interesting to know its history, from its creation to today. Here is a summary of the most important periods in the history of this index.

The Origins and Creation of the DAX 40

It was on July 1, 1988 that the DAX 40 was created with a base of 1 points. At the opening of the session, its rating was already 000 points. It was Franck Mella, who was then editor-in-chief of the German newspaper Börsen-Zeitung, who invented the DAX following a request from his publisher asking him to design an index of the German stock market. He was later rewarded for this work.

Since its creation, the DAX 40 has seen the birth of several other related stock market indices, in particular the MDAX which brings together the 50 largest companies just after those of the DAX, the TecDAX which includes the 40 largest market capitalizations outside the DAX and in the sector. technology only or the HDAX which integrates both the DAX 40, the MDAX and the TecDAX.

DAX 40 – 30 List of DAX Top Companies

At the time of its creation, the 30 values ​​which entered into the composition of the DAX 40 were the following:

• Allianz
• BASF
• Bayer
• Bayerische Hypotheken und Wechselbank
• Bayerische Vereinsbank
• BMW
• Commerzbank
• Shelf
• Daimler Benz
• Degussa
• Deutsche Bank
• Deutsche Babcock
• Deutsche Lufthansa
• Deuttse post
• Dresdner Bank
• Feldmuhle Nobel
• Henkel
• Maximum
• Karstadt
• department store
• Linde
• MAN
• Mannesmann
• nixdorf
• RWE
• schering
• Siemens
• Thyssen
• Plague
• viag
• Volkswagen

As you can see, this composition of the DAX 40 has since evolved significantly and many of these companies have been replaced by new ones over time. 17 of the companies initially present on this index are still present today.

First Stock Market Crash and Impact on the DAX 40

• On October 16, 1986, the Frankfurt Stock Exchange and thus the DAX 40 experience their first historic stock market crash following the Wall Street stock market crash. During this session alone, the price of the German benchmark index fell by 13% and subsequently recorded several other significant losses.
• But quickly, the DAX 40 succeeded in regaining value with a substantial and almost continuous increase in points over the following decade until it reached the level of 7 points in March.

Bursting of the Tech Bubble

• The ten years of rise recorded by the DAX 40 at that time were of course due to the enthusiasm of the markets for technology stocks then in full swing. But quickly, this enthusiasm began to decline and many investors liquidated their positions in these stocks in order to secure their profits.
• This gave rise to a sudden fall in the price of the German index, which fell below the 2 point mark in March 200. This historic low had not been reached by the DAX since the end of the year. 2003.
• Fortunately, the German economy, like the world economy, will eventually recover gradually and the index managed to find this upward trend until reaching a record high of 2000 points in 8. Unfortunately, the global financial crisis of 000 will put an end to this upward trend.

The Financial Crisis of 2008

• Thus and in October 2008, the price of the DAX 40 begins to fall again and, as of March 9, 2009, it has already lost more than 56% of its value compared to the peaks reached in 2007.
• A few years later, in June 2014 and while the European Central Bank had just taken the decision to follow the policy of low interest rates, the German economy picked up strongly and the price of the DAX 40 index reached for the whole first time in its history the level of 10 points.
• In January 2018, the price of the index will again reach a new bullish record at 13 points before finally ending this year at 559 points.

Covid-19 pandemic

• Finally, the last major event that affected the DAX 40 index is of course the coronavirus crisis which caused all of the world's financial markets to fall in 2020. Thus and in February and in the midst of a pandemic, the price of this index had just reached 13 points but quickly fell to the level of 797 points.
• Since then, it has resumed an upward trend, thanks in particular to the success of the vaccination campaigns carried out in the country and the lifting of health and economic restrictions.

Which DAX 40 Trading Styles?

Depending on availability, objectives, and even instruments traded, there are several trading styles you can adopt. We will discuss the different trading styles based on the timeframe.

• Scalping on Dax 40

Scalping is a very common style of trading which involves opening positions over extremely short periods of time. The objective here is to be able to profit from small price movements of a financial asset. The trader then opens a large number of positions with objectives of 5 to 20 pips. In this way, he gains little on several positions. Here, the chart is observed over periods of 5 to 15 minutes on markets with high volatility. Here is a DAX scalping strategy.

• Intra-day Trading or Daily Trading on DAX 40

It is a style of trading practiced by a good majority of intermediate level traders, and even professionals. It is suitable for traders who do not just trade all day long, but require some attention to market analysis. The courses are observed on periodicities from 4 hours to 1 day. You can trade any market there, provided you do your analysis well.

• The Swing and Long-Term Investments DAX 40

It is a style of trading that extends over long periods, a position can remain open for days, weeks or even months. The swing is also a very widespread trading style and very present in the spheres of high finance. Prices are first observed and then analyzed over long periods. Sometimes the analyzes are supported by an important economic announcement.

The trader does not need to spend his days in front of his computer as is often the case for scalping and day trading.

It is from this angle that long-term investments in the DAX 40 can be made. If you want to buy DAX shares, for example, you can opt for the swing trading method.

Should you invest in the DAX 40 in 2025?

It is since its last big rebound last October that the DAX has regained major upward momentum. Since October, the DAX 40 has been following a major upward trend; it must be said that this situation is quite favorable for futures traders. This considerable increase also means that the German economy has been in a major growth phase since last October. It would then bevantageux for traders to invest in the two trading options available on the DAX namely derivatives and stocks.

Analysts also follow this logic and the majority advises to buy now than to sell. It would then be profitable in any case to trade the DAX 40 on the rise or to buy the shares of the DAX this year.

This advice does not exclude doing technical, chart and fundamental analysis before making any possible trading decision.

Summary of Avantages and Disadvantages of the DAX 40

Investing in the DAX 40 offers several of which havevantages for individuals but may also have some limitations or present certain risks. Here is a summary table of the avantages and disadvantages of trading on this index or on the composition of the DAX 40.

Detail of Avantages of the DAX 40

Thus and in summary, here are explanations concerning the main avantages trading on the DAX 40 as a stock market asset:

• Strong economy – Germany's economy is currently considered one of the strongest in the world, both in terms of size and export volumes. The country's annual GDP is therefore among the highest currently available.
• Member of the European Union – The fact that Germany is part of the European Union offers it certain advantagesvantages. The country was thus able, thanks to this membership, to gain in competitiveness compared to other industrialized countries and other countries in the euro zone.
• Labor and taxationvantageUse – The German workforce is also one of the most skilled in the European Union, with a lower strike rate than in other European countries. Furthermore, the country's unified tax code offers a very favorable tax policy for businesses, including listed companies that are part of the DAX 40 index.

Detail of the Disadvantages of the DAX 40

Regarding the disadvantages and limitations that we mentioned above in the table of avantages and disadvantages of the DAX 40, here are also some additional explanations:

• Rescue plans – While Germany's membership in the European Union gives it some advantagesvantages, this also leads to some problems including that of sovereign debts. For example, the European debt crisis that took place between 2010 and 2012 forced this strong economy to participate in bailouts that weakened its finances.
• The debt of other EU countries – It's important to remember that member states of the European Union are linked by their sovereign debt problems. Therefore, when one country is unable to pay its debt, it can pull other, more financially stable countries into the same situation, potentially harming the German economy as well.
• The aging population – German demographics are also not working in favor of this economy. Indeed, the German population is increasingly aging, which can represent a significant economic burden in terms of social welfare. The country's fertility rate remains high, but not sufficient to reach the natural replacement rate. However, it should be noted that the country's high immigration rate could help mitigate this problem in the longer term.
• The economic slowdown – For the past few years, Germany's GDP has been experiencing a slight decline due to several factors. Indeed, global trade and its associated concerns are contributing to a slowdown in many economies, including Germany's. However, the GDP decline must be considered before trading on the stock market, as well as the increase in tariffs, which can have a significant impact on a country with substantial exports.

The Different Ways of Trading on DAX 40

As we have seen above, it is possible to invest directly in the price of the DAX 40 through CFDs offered by online brokers because this index is not an asset that you can buy through a classic stock market portfolio such as a PEA or a Securities Account.

However, you can invest in the composition of the DAX 40 with this type of product at Boursorama or any other online broker and by buying direct shares or ETFs or FCPs integrating one or more of these values.

The best way to speculate on the DAX 40 and its composition remains, however, derivative products such as CFDs but also DAX 40 Futures, barrier products, vanilla products or turbos 24.

Among the different trading platforms allowing you to invest in the DAX and its shares on the stock market, we recommend that you choose eToro which presents a significant offer of values ​​and an absence of commission on shares.

DAX 40 vs NASDAQ vs S&P 500

Conclusion

It is obvious that the DAX 40 is an interesting financial instrument on which significant profits can be made. Given its history and track record, the DAX has earned its place on the podium of the best global stock indices and with its high volatility has proven to be a major stock index with a good number ofvantages. With its strong leverage effect, Vantage FX remains the best broker for trading the DAX 40.

Who is DAX 40?

The DAX 40 is a major German stock index which is made up of 40 major German companies. It is in a way a reflection of the German economy.

❓❓ What Are the DAX 40 Trading Hours?

The DAX 40 is open for Monday trading from 6:30 a.m. to 19:00 p.m. GMT. This time corresponds to the 8:30 a.m. to 22:00 p.m. time slot in France.

Who Can Invest in DAX 40?

Everyone, there is no restriction on the quality of skill to trade on the DAX. Whether you are a beginner or a professional, whether you have substantial capital or just 1000 euros, everyone can invest in the DAX 40.