This was the work of Charles Dow. As he was working for the Wall Street Journal, he needed a way to aggregate economic performance as fast as possible. This led to the creation of a gauge used to measure the top North American industrial stocks, the Dow Jones Industrial Average.

What we now know as trade indices are not what was initially created. During those days, the index couldn't be traded. Investors that wanted to do something like this had to buy every single stock in perfect, equal weightings. This was not at all practical.

It was during the seventies that financial derivatives appeared and index futures started to be developed. Nowadays, financial innovation is the state of the art. There are countless retailers that work hard to speculate on the top stocks of the world. We thus end up having access to spread betting, index options, CFDs, and ETFs, among many other tools we could use.

The index CFDs are effective and simple for traders to use with the goal of profiting from the stock indexes of the entire world. Countless traders are now active on the market. Some of them use fast intraday trading while others want to use long-time investment frames that can last for months. However, in order to do this, it is important to look just at the really popular indices, those that have been around for a while.


Most Popular Trading Indices

The US 30

The US30 is practically the original Dow Jones Industrial Average. It became famous because of the Great Depression and nowadays, it is stronger than ever, pushing 30,000. The original components are no longer inside the index though. Other names like Alphabet, Facebook, and Amazon took their place. 

SP 500

The SP 500 is the largest index that is used by traders today. It practically covers the top US companies (500 of them), based on market cap. You can expect to see Microsoft, Google, and Facebook listed. However, index weightings for the top companies are lower. The SP 500 is nowadays practically a benchmark of the economy of the United States of America.

AUS 200

This is the main stock index used in  Australia. Its popularity is very high because it doesn't only dictate the state of the economy of Australia, it also shows us the state of the economy in Asia. So many of the components are affected by the financial evolution of China. When China goes strong, the AUS200 index rides high. When China has problems, the AUS 200 is affected.

UK 100

Last but not least, we have to mention the UK 100, which is officially known as FTSE 100. Similarly to AUS 200, it covers the main companies in the United Kingdom.This means you can easily expect names like Royal Dutch Shell, Vodafone, BP, and HSBC to be on the list.

Many other trading indices were developed in the past so with a little research you can easily find one that you can use in order to improve your CFD trading results.