IG Japan to terminate trading in India 50 index derivatives
IG Securities, the Japanese subsidiary of electronic trading major IG Group, is making changes to its lineup of trading instruments. The broker will stop offering trading in derivatives linked to the India 50 index (CFDs, binary options, etc).
Effective April 1, 2022, clients of IG Japan will not be allowed to open new positions in these instruments. By July 1, 2022, traders need to close all of the positions they still hold open in these instruments.
A stock index is a group of shares that are used to give an indication of a sector, exchange or economy. Usually, a stock index is made up of a set number of the top shares from a given exchange.
As a tracker of several stocks, a stock index itself does not have any inherent value. Instead, an index will move in points and reflect the stock prices of all of its underlying assets. Some stock indices will give equal weight to all the stocks they contain, whereas some will give larger prominence to larger stocks.
To trade a stock index, traders have to either use a tracking fund or a derivative like a CFD, future or ETF. These products all offer different methods of trading on the price movements of stock indices without having to by multiple stocks at once.