S&P/AS 51 Stock Index
AS 51 index keeps track of the top companies in Australian Stock Market. The total number of stocks used to calculate this stock index is the 200 top Australian companies represented in the AS 51. This index is calculated based on capitalization of the included companies & it is reviewed quarterly.
Even though this index is calculated based on capitalization, it doesn't track capitalization; it tracks changes in stock prices of various components stocks in this stock index.
The AS 51 Stock Index Trade Chart
The AS 51 Stock Index trade chart is displayed & 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 above is of AS 51 Stock Index on MT4 Forex & Indices Trading Platform.
Other Information about AS 51 Stock Index
Official Symbol - AS51:IND
The 200 components stocks that make up the AS 51 Stock Index are selected from the top Australian companies measured by capitalization. This 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 share prices move up and not when market capitalization does, therefore, this stock index show the difference in the share prices rather than the total market capitalization. This is because the base represents the starts value of all share prices & when this stock index is calculated it tracks the total change in the share prices.
Strategy for Trading AS 51 Stock Index
AS 51 Stock Index will generally move up because share prices always move upward over time. This index in general moves upward 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 upward 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 times it is doing well) this upwards trend is more likely to be ruling. A good stock index trade strategy would be to buy dips.
During Economic Slow-Down & Recession
During economic slow-down & recession times, companies begin to report lower profits & lower business growth prospects. It is because to this reason that investors begin to sell stocks of companies reporting lower profits & therefore index tracking these particular stocks will also start to move downward.
Therefore, during these times index trends are likely to be moving downwards & as a trader you should also adjust your trading strategy accordingly to fit the prevailing downward trends of the stock market index that you're trading.
Contracts & Specifications
Margin Requirement Per 1 Lot - AUD 70
Value per 1 Pips - AUD 0.1
NB: Even though general trend is generally upward, as a trader you've to factor in daily market volatility, on some days the index might oscillate or even retrace, index market retracement may also be significant at times & therefore as a trader you need to time your entry precisely using this trade strategy: Indices trade strategy & at the same time use proper money management rules just in case of more unexpected volatility in the market trend. About money management rules in index topics: What is money indices management and stock index trading money management methods.
