The Top Ten Indices Market Movers
Indices play a big role in trading, whether it is stock trading or forex trading. You may have heard the term "indices as market movers". What does this term mean?
We will explain it later, but first, you should know something about the indices or indexes and their importance to the stock market. The indices or indexes are the groups of valued assets.
But can you invest in indices without investing in individual assets? How is that possible? Well, here comes the main investment tool used for investing in indices.
This instrument is called an Exchange-Traded Fund (ETF). You can trade ETFs in the stock markets as well as in the foreign exchange movers. These ETFs are considered the main market makers for indices.
Do not get confused by all these terms as we will explain them one by one. From index to index trading to index market movers.
What is an index?
An index is a value for a group of assets. There are many assets on the stock market such as company shares, securities, bonds, stocks, futures, etc. They all have different values or price indices. But, what if we grouped some of these assets and created an index value for them?
When we do this, this grouped value is called an index value.
For example, the S&P Global 100 Index, the FTSE All-World Index, the S&P Global 1200 Index, etc. In these indices or indexes, you see a different number of companies grouped together.
What are the indices market movers?
The S&P Global 100 Index includes the shares of the hundred largest companies. These companies are those listed on stock exchanges. They are not the market movers, but the investment funds for the indices are the market movers.
Let us jump to the next section of this post. The S&P, Nasdaq, Dow-Jones and various other volatile stock indices are traded on stock exchanges. These market indices are replicated by large companies such as Vanguard and iShares to allow shareholders or traders to diversify their investment strategies.
How To Invest In Indexes?
Yes, you can invest in indices. But it is not possible directly. For that, you have to invest your capital in an Exchange-Traded Fund.
Where can I find ETFs?
Well, many financial companies offer such mutual funds for market indices and allow the trader to make a diversified investment in index funds. Investing in equity indices is good if you want to trade volatile small-cap or large-cap asset class stocks.
So an ETF is the only way to invest in indices, which is why we call them Index Funds. And they are also known as the indices that move the stock market.
How Exchange-Trade Funds (ETF) Works?
You can invest in an ETF if you want to invest directly in index funds. For example, if you want to invest in the S&P stock index, you need to find an ETF that mirrors the S&P. By mirroring, we mean that you need to choose an ETF that contains the same companies as the S&P.
So if you invest in this ETF, you can indirectly invest in the S&P. The main purpose of these funds is to give you a mirror to invest in indices. For this reason, these funds are considered to be the main market movers. These indices that move the market are explained below in the top ten list.
Which Companies Offer ETF?
There are many companies that offer excellent services for investing in indices through ETF. Some of the major companies are iShares, Vanguard, Invesco, Charles Schwab, etc. It is very easy to understand that the companies that offer Exchange Traded Funds are known as ETF companies.
10 Major Market Movers of Indices
Below you will find a list of the most important indices market movers. We have listed the most important ETFs here. These ETFs are performing well and have the largest market share of the indices market. For this reason, we provide you with a list of the most important ETFs that move the most indices.
Because the fluctuation of these ETFs is always related to the market movement. Because these ETFs accurately track the major indices of the various stock exchanges.
#1. SPDR S&P 500 ETF
If you follow and analyse the S&P 500, this is the ETF for you. Because it will move in the same direction as the S&P.
#2. Vanguard S&P 500 ETF
Another S&P 500 ETF that you can use to track the trading of the S&P 500. If we sort all ETFs by assets under management, this ETF is one of the top five.
#3. iShares Core U.S. Aggregate Bond ETF
If you are an equity trader and you want to have a long-term investment portfolio, then it is important to invest in US bonds. And the best ETF for this investment is iShares Core U.S. Aggregate Bond (AGG).
#4. Vanguard Total Stock Market ETF
One of the best investment vehicles for large-cap growth stocks. It is suitable for investors who want to invest in different sectors. This makes it one of the top indices that move the market in the trading world.
#5. Invesco QQQ
If you want to invest in a particular category or sector, this ETF is the best choice. This is because it is based on the most important benchmark for technology companies, the NASDAQ. The Invesco QQQ is very popular with traders.
#6. iShares Core S&P 500 ETF
The S&P is one of the most important global stock market benchmarks. This index is tracked by many global, national and regional exchanges. For this reason, all ETFs that follow the S&P are important indices that move the market.
#7. SPDR Gold Trust
If you want to invest in precious metals like the commodity gold, then the SPDR Gold Trust ETF is the best one for you. Gold is a commodity that has become a safe investment for your portfolio.
The trading volume of gold makes the SPDR Gold Trust one of the most traded indices.
#8. iShares Core MSCI EAFE ETF
The first option for buy-and-hold traders or traders with an interest in mutual funds. Less risky allocation of funds and earning dividends, capital gains, fixed income and low brokerage fees are some of the key features of this ETF. These features make it an index market mover.
#9. iShares Russell 2000 ETF
From small-cap to mid-cap stocks, the iShares Russell 2000 is the best stock market ETF you can invest in. An investment company or the fund manager can use it for more leverage.
#10. Vanguard Healthcare ETF
During the global health crisis due to COVID -19, US healthcare stocks are in demand, which is why the healthcare sector is booming. You can compare the market capitalisation of different companies and then invest in this large fund among the market makers of the indices.
Conclusion - Indices Market Movers
Basically, the market movers of the indices are investment funds set up for the indices. The technical and official name for these funds is ETF or Exchange Trade Fund.
These funds are offered by many ETF companies and are all well suited for traders who want active management of the stock market indices.
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