You will be able to trade a variety of synthetic indices offered by the deriv broker, such as volatility indices, jump indices, boom and crash indices and others.
Introduction
As traders at Forexafunds, it is crucial to grasp the various asset options at our disposal to maximize our trading opportunities. In this article, we will delve into the details of synthetic indices offered by the broker Deriv, including Volatility Indices, Booms and Crashs, Jump Indices, and more. Understanding these assets is essential for making informed trading decisions.
Synthetic Indices: What Are They?
Synthetic indices, as offered by Deriv, are innovative financial instruments that allow traders to access volatile and dynamic markets without having to trade the actual underlying assets. They are constructed using a blend of complex algorithms and real-time market data to simulate the behavior of real assets.
Key Synthetic Indices
Volatility Indices: Volatility Indices replicate market volatility. They provide a unique trading opportunity by enabling traders to speculate on volatility itself. Among the most well-known is the VIX, often dubbed the "fear index," which measures the implied volatility of S&P 500 options
here are the available volatility indices:
- Volatility 10 index
- Volatility 25 index
- Volatility 50 index
- Volatility 100 iindex
- And all volatility Indices listed by deriv
Booms and Crashs: These synthetic indices simulate extreme market movements. The Boom 500 reflects strong upswings, while the Crash 500 represents sharp downturns. This allows traders to profit from atypical market scenarios
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Jump Indices: Jump Indices capture sudden market movements. They are designed to capture moments when markets abruptly shift from an uptrend to a downtrend, and vice versa.
Why Trade Synthetic Indices?
Synthetic indices offer several advantages to traders:
Diversification: They allow you to add diversity to your portfolio by trading different types of indices, potentially reducing risk.
Accessibility: You can trade these indices 24/7, offering great flexibility in terms of trading hours.
Controlled Volatility: You can speculate on volatility itself, which can be advantageous in volatile market conditions.
Conclusion
The synthetic indices offered by Deriv are powerful trading tools that can add a new dimension to our trading strategy at Forexafunds. By understanding their characteristics and opportunities, we can make more informed trading decisions and maximize our chances of success in the financial markets. However, it is essential to remember that trading carries risks, and it is advisable to receive proper training and manage these risks appropriately.