S&P/AS 51 Stock Index
AS 51 index keeps track of the top companies in Australian Stocks Exchange Market. The total number of stocks used to calculate this stock index is the 200 top Australian companies represented in the AS 51. This stock index is calculated based on capitalization of the included companies and it is revised quarterly.
Even though this stock index is calculated based on capitalization, it does not track capitalization; it tracks the change in stock prices of various components stocks in this stock index.
The AS 51 Index Trade Chart
AS 51 Stock Index trade chart is shown & illustrated and shown above. On the example above this instrument is named as AS51CASH. As a trader you want to find a broker that provides AS 51 Stock Index trade chart so that you can begin to trade it. The example That is shown above is that of AS 51 Stock Index on MetaTrader 4 Forex & Software Platform.
Other Information about AS 51 Stock Index
Official Indices Symbol - AS51:IND
The 200 component stocks that make up the AS 51 Stock Index are selected from top Australian companies measured by capitalization. This stock index has a base up on which the calculated total market capitalization is adjusted relative to this base - the calculation also has a divisor that means that this index will only reflect a change in movement only when the shares prices move up and not when market capitalization does, hence, this index show the difference in the shares prices rather than the total market capitalization. This is because the base represents the starts value of all shares prices and when this stock index is calculated it tracks the total change in the shares prices.
Strategy for Trading AS 51 Stock Index
AS 51 Stock Index will in general moves move up because shares prices always move upward over time. This index in general moves upwards over the long-term because Australian economy also shows strong growth backed by their mining sector which has great reserves of Gold as well as other valuable commodities.
As a trader wanting to trade this stock index, index will move upwards faster when the Australian economic indicators show accelerated economic growth.
As a trader you want to be biased & keep buying as the index moves upward. When Australian economy is doing well (most of the times it is doing well) this upward trend is more than likely to be ruling. A good stock index trade strategy would be to keep buying the dips.
During Economic Slow-Down and Recession
During economic slow-down & recession times, firms start to report lower profits & lower business growth prospects. It is because of this reason that investors start to sell stocks of companies that arereporting lower profits & hence index tracking these particular stocks will also start to move downward.
Therefore, during these times stock index trends are likely to be moving downward & as a trader you should also adjust your trading strategy accordingly to fit the prevailing downward trends of the stock market stock index that you're trading.
Contracts & Specs
Margin Requirement Per 1 Lot - AUD 70
Value per 1Pip - AUD 0.1
NB: Even though general trend is generally move upward, as a trader you've to factor in daily market volatility, on some days the stock index may move in a range or even retrace, market retracement might also be significant at times & therefore as a trader you need to time your trade entry precisely when using this trade strategy: trade strategy & at the same time use proper equity management principles just in case of more unexpected volatility in the market. About equity management principles in index topics: What's money indices management & stock indices money management strategies.
