in this video we're gonna look at the
Nasdaq 100 index what it is and why it's
so popular with traders around the world
hello I'm David Jones from capital comm
and this is the latest in our series of
looking at popular markets for traders
all around the world this time around
we're gonna focus on a US stock market
index and we're gonna take a look at the
Nasdaq 100 we're gonna look at what it's
made up of how does it move and why is
it so popular with traders let's get
started
so let's take a look at what is the
Nasdaq 100 index and why is it so
popular so the Nasdaq 100 is made up
from the hundred largest non-financial
companies and that's really important
they're listed on the NASDAQ exchange it
is often confused with the Nasdaq
Composite that's the one that is
commonly referred to as a Nasdaq but
this one the composite includes every
company listed on the NASDAQ exchange so
going back to the Nasdaq 100 this
exclusion of financial companies gives
it a very different feel I think to the
likes of the S&P and the Dow Jones with
the Nasdaq 100 more biased towards
technology and the reason it appeals to
traders is because of the daily
volatility we see on this index so how
can you trade the Nasdaq 100 with
capital com you can trade contracts for
difference CFDs on the Nasdaq 100 now
you may be familiar with CFDs but they
let you trade using leverage so what
this means is a small amount of money
can control a much bigger financial
position so in effect you're getting
more bang for your buck but of course
you're having the opportunity to magnify
profits but that also means you're
magnifying losses as well so it's very
important to use risk controls such as
stop losses to manage the downside with
CFDs you can trade markets in both
directions so if you thought the Nasdaq
100 was going to rise you could by using
CFDs and the CFD would track
what the index is doing or if you
thought that Nasdaq was do a sell-off
you can short sell using CFDs
and position yourself to try and profit
from a fall in the price of the Nasdaq
100 index let's take a look at some of
the moves in this index if we went back
to October 2018 the market was trading
just above 7700 slid really heavily into
December down below 6000 and then has
bounced back back up to 7800 so plenty
of swings there let's take a look on a
shorter timeframe so this is the last
couple of days and just over the last
couple of days this market has gone from
what 7602 trade down towards the 7300
level and it's this sort of volatility
that traders really liked which is why
the nasdaq 100 is so popular so you can
see the nasdaq 100 it's quite different
from the likes of the S&P or the Dow
because for a start it's excluding all
of those financial stocks so it's got a
very different mix you can see from the
volatility why it's so popular with
traders they seldom you know a dull day
or even a dull week you know depending
on what your time frame is and traders
will use contracts for difference to
trade these sort of markets you know and
the reason for that is you can trade the
market in both directions so if the
nasdaq-100 starts to slide you can
position yourself to profit from a drop
in price and you also have leverage and
as I said when we were going through the
information there you know leverage does
cut both ways you have the chance of
making more profits but of course
hand-in-hand with that goes the risks of
increasing your losses when you're wrong
so it's really important to use risk
management controls such as stop losses
but you can find out more about all of
that and contracts for difference in
general by going to the capital com
website we'll start wrapping things up
there so for this quick overview of the
Nasdaq 100 and why it's so popular with
traders we'll leave it there so for me
David Jones and capital com
good luck with your trading
[Music]