Skip to content
Risk warning: Our products are leveraged and carry a high level of risk, which can result in the loss of your entire capital. Such products may not be suitable for all investors. It is crucial to understand the risks involved fully.
  • Support
  • For Institutionals
  • Trading

    Trading Platforms

    • MetaTrader 4 Terminal
    • MetaTrader 5 Terminal
    • PAMM Accounts
    • Equinix Trading Server

    Markets coverage

    • Forex Currencies
    • Spot Metals
    • Commodities

     

    • CFDs on Stocks
    • Indices
    • CFDs on Crypto

    Start Trading

    • Standard Accounts For individuals
    • Institutional Account For professionals
    • Deposits & Withdrawals
  • Conditions

    Trading Conditions

    • Spreads Overview
    • Swap-Free
    • Leverage Information

     

    • CFD Specifications
    • Full Trading Conditions

    Invest on your terms

    Transparent pricing, reduced trading costs, and leverage that adapts to your strategy.

    Explore conditions
  • Tools
    • Weekly Outlook
    • Daily Technical
    • Market Commentary
    • Economic Calendar
    • News & Insights
  • About
    • About OnEquity
    • Company News
    • Legal Documentation
    • Client Protection
    • Help & Support
    • FAQs
  • Partners
Edit Content
  • English
    ACTIVE
Other languages:
  • Español – Spanish
  • Português – Portuguese
  • English – International
  • Trading
    • Markets Coverage
    • MetaTrader 5 Platform
    • MetaTrader 4 Platform
    • Standard Accounts
    • Institutional Account
    • PAMM Accounts
    • Equinix Trading Server
    • Deposits & Withdrawals
  • Conditions
    • Spreads Overview
    • Leverage Information
    • Swap-Free Trading
    • CFD Specifications
    • Full Trading Conditions
  • Tools
    • Daily Technical
    • Weekly Outlook
    • Market Commentary
    • Economic Calendar
    • News & Insights
  • About
    • About OnEquity
    • Company News
    • Legal Documentation
    • Client Protection
    • Help & Support
    • FAQs
  • Partners
  • Client Portal
  • Open Account
Edit Content
  • English
    ACTIVE
Other languages:
  • Español – Spanish
  • Português – Portuguese
  • English – International
Open Account
Client Portal
Education, Intermediate

DAX 40 Explained: A Complete Guide to Germany’s Premier Stock Index

April 24, 2025 OnEquity

Discover what the DAX 40 is, how it’s composed, how to invest in it in 2025, and why it remains a key benchmark in the European stock market landscape. A comprehensive, up-to-date guide designed for both active traders and long-term investors.

What Is the DAX and Why Is It So Relevant for Investors?

If you’ve been involved in the financial markets for some time, you know that certain indices serve as barometers of the global economy. The DAX 40 is one of them. Regardless of which continent you operate from, this index is an indispensable benchmark for any well-structured investment portfolio.

Formerly known as the DAX 30, the DAX 40 is Germany’s leading stock market index. It is composed of the 40 largest and most liquid companies listed on the Frankfurt Stock Exchange. The expansion from 30 to 40 companies, which took place in September 2021, aimed to improve sector representation and more accurately reflect the German economy.

This index combines industrial, technology, pharmaceutical, and consumer companies such as Siemens, Bayer, SAP, and Allianz—all with global reach and significant weight in their respective sectors.

How Is the DAX 40 Composed and What Are Its Criteria?

The DAX is managed by Deutsche Börse, which periodically reviews the composition of the index under strict criteria:

  • Free-float-adjusted market capitalization
  • Trading volume (liquidity)
  • Strict accounting controls (following the Wirecard case)
  • Sector diversity (no fixed quotas, but balanced representation)

This approach has allowed the DAX to modernize, incorporating companies from emerging sectors such as Airbus and Zalando, making it a dynamic, robust index aligned with new market trends.

An Economic Barometer for Germany (and the World)

Germany is Europe’s largest economy and the fourth largest globally. In this context, the DAX not only reflects the financial pulse of Germany but also serves as a leading indicator for the European and global economy.

Many of its companies have a strong international presence. For example, BMW generates a large part of its revenue outside Germany, allowing the DAX to react even to events in Asia, America, or emerging markets. This makes it valuable for macroeconomic analysis and strategic investment decisions.

Technical and Fundamental Analysis of the DAX

Technical Outlook

The DAX responds clearly to technical levels such as support, resistance, and classic patterns (triangles, channels, etc.). Tools such as RSI, MACD, or moving averages often provide reliable signals due to the index’s volume and liquidity.

In 30-minute, 4-hour, or daily time frames, it’s possible to detect key breakouts that allow for high-precision strategies, especially during European sessions.

Fundamental Outlook

From a fundamental perspective, macroeconomic indicators such as the manufacturing PMI, exports, or the IFO index should be monitored. The performance of the euro also has an influence, given the export orientation of many DAX companies.

Reviewing the quarterly results of key companies such as SAP or Deutsche Bank is essential to anticipate the index’s movements.

Intraday or Long Term? The DAX Offers Both Options

The DAX 40 suits different investment styles:

  • For traders: Its moderate volatility, tight spreads, and availability in futures make it ideal for active trading.
  • For long-term investors: Its solid track record, corporate quality, and dividend reinvestment make it a powerful tool for building a diversified portfolio.

DAX Companies to Keep an Eye On

Although the index includes 40 companies, some stand out for their leadership and strength:

  • SAP: Enterprise software giant
  • Siemens: Leader in automation and infrastructure
  • Allianz: Heavyweight in insurance and asset management
  • Bayer: Strong presence in pharmaceuticals and agrochemicals
  • Deutsche Telekom: Stable growth and attractive dividends

Investing in these companies individually may be an interesting option for those seeking selective exposure within the DAX universe.

How to Invest in the DAX? ETFs, Futures, and Derivatives

There are multiple ways to trade this index:

  • ETFs (such as the iShares Core DAX UCITS ETF): Ideal for passive investing
  • DAX futures (FDAX): Used by professionals, with high liquidity and efficient execution
  • Barrier options and options on the DAX: Allow for hedging, leverage, or income-generation strategies

Your choice will depend on your profile. If you are conservative, ETFs are a safe and diversified option. If you prefer more active strategies, futures provide greater control and operational speed.

Historical Highlights of the DAX

Since its creation in 1988, the DAX has offered an average annual return between 7% and 9%, including periods of expansion (2003–2007, 2012–2019) and sharp declines (2008, 2020, 2022).

A crucial fact: the DAX automatically reinvests dividends, which significantly increases its long-term performance. This detail, often overlooked by novice investors, explains much of its solid track record.

Investing in the DAX 40 with OnEquity

OnEquity allows you to invest in some of the world’s most traded stock indices, including the NASDAQ 100, DOW 30, DAX 40, FTSE 100, and EURO STOXX 50. The platform offers several advantages:

  • Access to all major U.S., European, and Asian indices
  • Leverage of up to 1:1
  • Ultra-competitive spreads
  • No commissions

Conclusion: The DAX 40, an Index for All Types of Investors

The DAX 40 not only represents Germany’s largest companies but also acts as an economic barometer for Europe and the world. Its diverse composition, constant evolution, and global relevance make it an essential benchmark for any investment strategy—day, short, medium, or long term.

Whether you’re seeking stable exposure through ETFs or prefer to trade futures and options, the DAX offers powerful tools, transparency, and a proven track record that positions it as one of the most reliable indices on the international scene.

  • Dax 40
  • Education

Post navigation

Previous
Next

Search

Categories

  • Analysis (217)
  • Beginner (24)
  • Cryptos (145)
  • Currencies (188)
  • Daily Technical (147)
  • Education (64)
  • Expert (23)
  • Intermediate (17)
  • Markets (434)
  • News & Releases (22)
  • Stocks (290)
  • Uncategorized (1)
  • Weekly Outlook (69)

Recent posts

  • Trading Hours Update – Additional Changes for August 2025
  • Today’s stocks to watch: Berkshire, Boeing, and Amazon
  • U.S. stock futures rise on heightened hopes for interest rate cuts

Tags

Analysis Bitcoin Cardano CPI Crypto Cryptocurrencies Currencies Daily Dollar earnings Education Elections ETF ETFs Ethereum Euro Fed Index inflation Litecoin Market Markets Nasdaq oil Outlook Pound Ripple SEC Solana Stablecoin Stock Market Stocks Stocks Market Stocks today Technical Technical Analysis Technology Tether Trading Trump Wall Street Weekly Weekly Outlook Yen Yuan

Related posts

Education, Intermediate

Forex 101: What Every Trader Should Know About Currency Pairs

June 26, 2025 OnEquity

In the foreign exchange (forex) market, all transactions involve the simultaneous exchange of one currency for another. This is why currencies are always quoted and traded in pairs—when you buy one currency, you are inherently selling another. A currency pair reflects the value of one currency relative to another. For example, in the EUR/USD pair, […]

Beginner, Education

Decoding Liquidity: The Key to Smarter Trading

June 19, 2025 OnEquity

Understanding liquidity is essential for identifying optimal markets in which to buy and sell financial assets. In trading, liquidity measures how easily an asset can be exchanged between participants without causing significant price movement. High liquidity typically reflects a more efficient market—where buyers and sellers are readily available, enabling smooth and timely transactions. This article […]

Beginner, Education

The Power of Supply & Demand: Unlocking Trading Opportunities

June 12, 2025 OnEquity

In the world of trading, mastering the concepts of supply and demand is not only an advantage, but a necessity. These two fundamental forces are responsible for price movements in financial markets and, if you know how to interpret them correctly, they can become powerful tools for making more accurate and profitable decisions. Throughout this […]

  • Privacy policy
  • Client agreement
  • Legal
  • Support
  • +2484671965
  • [email protected]
  • Chat with us
Company
  • About us
  • Regulation
  • Safety of funds
  • Company news
  • Insights
  • FAQ
Account options
  • Standard accounts
  • Institutional account
  • PAMM accounts
  • Swap-free account
Conditions
  • Spreads overview
  • Leverage tiers
  • CFD specifications
  • Markets coverage
Trading tools
  • MetaTrader 5
  • MetaTrader 4
  • Equinix trading server
  • Economic calendar
  • Daily technical
  • Weekly outlook
  • Market commentary
OnEquity Ltd is incorporated in Seychelles as a Securities Dealer with License No. SD154, authorized by the Seychelles Financial Services Authority (FSA), adhering to the Consolidated Securities Act, 2007. Registration No. 810588-1.

The website is operated and provides content by the OnEquity group of companies, which include:

OnEquity SA (Pty) Ltd, incorporated in South Africa, Company reg. 2021/321834/07, regulated by the Financial Sector Conduct Authority (FSCA) with FSP No. 53187.

OnEquity LLC, recognized by the Registrar of International Business Companies and the Financial Services Authority in St. Vincent and the Grenadines, Registration No. 286 LLC 2020.

ONEQ Global Ltd, registered in Cyprus, Company reg. HE 435383, located at Agias Zonis 22, Limassol, focusing on comprehensive service solutions within the OnEquity Group.
Risk Disclosure: Trading in financial instruments involves substantial risk and may not be suitable for all investors. The value of investments is volatile and can result in total loss of capital. Investors should consider their financial situation, investment experience, and risk tolerance, and may seek professional advice. Past performance is not indicative of future results.

Eligibility: Services are available to individuals 18 years or older.

Restricted Jurisdictions: The content provided by OnEquity is not intended for residents of the United States, Canada, North Korea, Yemen, Iran, Belgium, Syria, or any jurisdiction where such distribution or use would be contrary to local law or regulation.

All trademarks™ and brand names belong to their respective owners and are used here for identification purposes only. Use of these names does not imply endorsement.
© OnEquity. All Rights Reserved.