The Australia 200 Trading Day

The SPI Futures Index for futures traders and the Australia 200 continuous contract for CFD traders gives us the opportunity to trade the Index that contains the top 200 shares on the ASX. 

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The Australia 200 Index Trading Day

The Australia 200 index trading day starts at 9:50 am Sydney time which is 10 minutes before the general ASX market opens and closes at 4:30 pm Sydney time, which is 30 minutes after the close of the ASX market. There is also a night session that opens at 5:10 pm and trades through the European and US market sessions closing at 8:00 am (Non US daylight savings) and 7:00am (US daylight savings)

TradeDirect365 have the tightest day session fixed spread for the Australia 200. This is set at 0.9 pts with no commission at the time of writing this article. The SPI Futures in contrast has a 1pt spread and an added commission depending on the broker used. For short term Australian Index trading there is some clear advantages for CFDs over futures.

Another advantage is that with futures, a single contract is $25 per point movement whereas with CFDs there is the ability to trades in smaller portions and with lower margin requirements.

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Australia 200 Index – When is it Volatile?

When trading the Australia 200 you will likely find the most volatile part of the days’ session is in the first 45 minutes of trade and the last hour of the day session. The “Lunch” session is generally a quiet time where volatility is lower.  Exceptions to this rule is when there is news announcements that affect the market as a whole such as interest rate changes and employment numbers or whenthere is news that affects large cap stocks within the Australian 200 index.

Over the last few years, news events out of China have also influenced market direction to a greater degree with commodity stocks reacting to policy decisions and economic news.

When trading the index it is prudent to keep an eye on potential events that can move the market as well as having a strategy to deal with the changing intraday market volatility.

With trading individual stocks it can be an advantage to see if there is underperformance or outperformance versus the index. If the index is weak but the individual stock is performing well there may be a higher potential that the individual stock will continue its upward momentum especially if the index is stronger the following day.

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To find out more about trading the ASX 200 Index & SPI Futures CFD, please click here.

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