What is the AEX index?
AEX index (NL25) is a free-float market capitalisation index which includes 25 of the largest and most traded companies listed on the Amsterdam Stock Exchange. It was launched in 1983 and it serves as an indicator for the performance of the Dutch stock market. The constituents are subject to annual review when companies can be removed or added. These reviews are also used as a means to ensure that the weighting of each stock adequately covers the sector it serves. Stocks coming from sectors such as technology, oil and gas or personal and household goods have a greater portion of the AEX index. Accordingly, some of the biggest companies on the index in terms of market capitalisation are: Unilever N.V, Royal Dutch Shell, Heineken and ASML Holding N.V, among others.
The weighting of companies on the index is capped at 15 per cent, the weights are calculated using the closing price on the relevant review date. Aside from the regular annual review, a fast entry or replacement review can be performed each quarter if specific circumstances arise (changes of 10 per cent or more in the free float factor or changes of more than 20 per cent in the number of shares).
Movements in AEX index value
Due to its compositions, the AEX’s value can be affected by various company-specific and industry-specific factors, as well as wider macroeconomic considerations. Therefore, global events which impact certain sectors, such as oil and gas (which take a higher portion of the index), can have a strong effect on the AEX.
The weekly price chart shows that AEX moves in a clearly defined upward trend for an extended period. The chart also displays that price retracements can occur regularly.
In 2011 the AEX sank to a near-decade low of around €270. In the subsequent nine-years, the index more than doubled, testing €630 in February 2020.
The Covid-19 crisis put an end to this trend of consistent growth, when it triggered a global recession which is expected to dwarf the Global Financial Crisis.
Even though the fall in the AEX was unexpected, it still created significant opportunities for traders to profit. After a depreciation of almost 35 per cent in a matter of weeks, the index bounced back by more than 20 per cent.
How to trade AEX index
If you need an instrument which will be able to mimic the changes in the AEX price or the price of other securities or trading assets, then Dzengi.com is at hand. Our platform provides the opportunity for leveraged trading on tokenised assets.
Dzengi.com utilises blockchain technology to create tokens for a tradable asset such as indices, stocks, commodities, and many more. The tokenised AEX index enables you to easily take long or short positions and benefit from the value movement, all without the need to enter into time restrained contracts or the obligation to pay excessive transaction fees.
When you trade AEX index tokens with Dzengi.com, you are eligible to buy and sell a tokenised version of the NL25 using leverage of up to 1:100. With such leverage, a trader can generate much higher profits than can normally be made when solely using their own capital.
For instance, imagine that the value of NL25 index moves by 2 per cent and you have €350 of available capital to benefit from this price change. It means that you will make €7 in profit. However, if you use your available capital to open the same position on the tokenised AEX index using the margin of 1 per cent offered by Dzengi.com, you will have a position worth €35,000. Consequently, a 2 per cent price movement could help you gain €700. You can thus generate much higher profits in AEX trading when using the leverage option.
Dzengi.com users can use either their Bitcoin or Ether assets. Unlike other platforms, our users do not need to exchange their cryptocurrency holdings before they trade. Traders can now trade tokenised assets directly with crypto or with fiat money, whatever suits them best.
Tokenised AEX trading guide
A few basic steps when using our leveraged trading platform:
- Step 1: Register to Dzengi.com simply by providing the information required with the two two-factor authentication security, which improves platform security.
- Step 2: Decide which type of funds you will deposit on your account – you can trade with crypto or fiat money.
- Step 3: Decide how much money you want to put in a single position based on the 1 per cent margin available.
- Step 4: The process to enter a transaction is the same as for other instruments: you open a long position for potential price appreciation, or a short position is taken for an expected price decrease.
- Step 5: Orders executed on the Dzengi.com platform are initially linked between platform traders, the free orders are afterwards hedged on Capital.com and LMAX Digital or on Binance, Bitstamp, Kraken, NASDAQ, NYSE and Gain Capital.
- Step 6: You decide when and how to close your positions and you can also choose to set a take profits order.
Why trade tokenised AEX index with Dzengi.com
AEX trading at Dzengi.com tokenised securities exchange has a number of advantages. Tokenised securities are underpinned by robust and immutable blockchain technology. Opening a trade will give you a token that tracks and moves according to the underlying instrument's price.
- One-stop crypto trading platform
Trade tokenised AEX index with Bitcoin or Ethereum. Benefit from the commodity's price movements without turning your crypto assets into fiat.
- Tight spreads
Trade tokenised NL25 with a tight market spread, benefit from maker rebates and competitive taker fees.
- Leverage
Experienced traders can trade the world's top markets, like the AEX, with up to 1:100 leverage.
- Effective risk management
Manage your risks and secure your profits with stop loss and take profit orders. Save your assets with negative balance protection.
- Instant order execution
We have a scalable and low latency order management system, which can execute 50 million trades per second.
- Safe regulation
Dzengi.com operates under new Belarusian regulation with best-in-class AML and KYC laws. Regulatory details and fees are upfront.
