Features of GEMFOREX’ US500(S&P500) trading

  • You can trade in the same way as Forex
  • Adopts MetaTrader 4 (MT 4)
  • No rejection and contract refusal
  • Absolutely No Hidden Markup
  • Realizes 99.79% of commitment within 0.78 seconds
  • The shortest 30 seconds account opening & Easy, speedy until start of trading

And more…
GEMFOREX continues to pursue a comfortable environment of traders, and US500(S&P500) can be used with confidence by beginners and those experienced people in Forex under the MT 4 environment familiar to US500(S&P500).

What is US 500 (S&P500)

US 500 (S&P500) is a representative stock index in the United States.

Also called S&P500, taking the initials S & P from what American Standard & Poor's has elected. It is one of the representative stock indexes in the United States.

Constituent brands of US 500 (S&P500)

US 500 (S&P500) is a stock index consisting of 500 stocks representing America. The 20% accounts for the sector of information technology accounts, 16% for the financial sector, the health care sector 14%, the consumer service 13%. Compared with US 30 (DJ 30), which is more likely to be compared, the sector of information technology is large and consumption sector is small.

Among the brands of US 500 (S&P500), Apple has the highest composition ratio. It is also a representative issue of US 30 (DJ 30). Next is Microsoft of the same information technology sector as Apple. These two companies alone constitute nearly 6% of the total of 500 companies. It shows that IT related companies are underpinning the US economy.

The next largest component ratio is Exxon Mobil in the energy sector. Johnson & Johnson, a world-renowned pharmaceutical manufacturer, has become one of the major issues of US 500 (S&P500). Wells Fargo, JP Morgan and Berkshire in the financial sector are among the top ten issues of US 500 (S&P500). Unlike US 30 (DJ 30), which is selected from the stock price average of constituent stocks, US 500 (S&P500) is elected based on market capitalization. Since market capitalization is the standard, there is a characteristic that the entire index is not easily affected by the magnitude of the stock price compared with the simple average of the stock price. It is reviewed periodically.

Difference between US 500 (S&P500) and US 30 (DJ 30)

Both US 500 (S&P500) and US 30 (DJ 30) are stock indexes that global investors pay attention to. US 30 (DJ 30) is an index among the selected higher stock prices of US 500 (S&P500) stocks, but the scenes and purposes that can be used vary from the difference in calculation method.

Since US 500 (S&P500) is based on the market capitalization calculated by the stock price multiplied by the number of shares issued, the larger the market capitalization, the better the performance of the company. Since US 500 (S&P500) is market capitalization exceeding 80% of the US stock market, you can grasp the current economic situation of the entire market of the United States. If US 500 (S&P500) rises to the right, it indicates that the US economy is doing well.

Since one US 30 (DJ 30) is the stock price average, the demand balance is reflected at that timing. If many stocks are bought, the stock price will rise, and if stocks are sold on the contrary the stock price will fall. The stock price is also a parameter showing the value of the company, and the US 30 (DJ 30), which directly reflects the stock price buying and selling, becomes a good foreseeing factor for the future economy of the American market.

However, when you look at the past price movements, the price movements of US 30 (DJ 30) and US 500 (S&P500) are almost the same even though the increase and decrease ranges are different. The reason is that the stocks making up US 30 (DJ 30) are in US 500 (S&P500), US 30 (DJ 30) alone occupies a large proportion of market capitalization of US 500 (S&P500). Even if the vectors of price movements temporarily differ, there is a compatibility that will match the balance of accounts.

The transition of US500(S&P500)

Since US 500 (S&P500) is a parameter showing the situation of the American economy, we can understand what history the US economy has traced by looking at the current price movements. Since the beginning of the 21st century, US 500 (S&P500) has recorded a decline in the United States simultaneous terrorist attacks that occurred in 2001. Because terrorism and war make the economic situation unstable, you can see that stock prices always fall immediately after these emergencies.

In 2008, they recorded a significant decline in the Lehman shock that shook the world economy. Lehman shock, which is said to be once in one hundred years, is caused by financial instability spreading due to the collapse of Lehman Brothers, a real estate company that was said to be safe at that time. Many financial institutions and investors lost funds.

However, after that, they are steadily increasing the price. Although it has crashed several times when looking at a long span, after that it returns to the original value and continue to renew a high price. Even if a big company that goes into war and the world economy goes bankrupt, the short-term impact is one of the factors that show the strength of the American economy.

US 500 (S&P500) as an investment target

US 500 (S&P500) is made up of the top 500 companies of American companies. As the composition ratio is dispersed, even if a company with a large market capitalization goes bankrupt, there is a characteristic that the risk that the US 500 (S&P500) will noticeably fall is small. Compared to US 30 (DJ 30), it is highly stable stock index, so it is suitable for investment including CFD.

Also, since the 21st century, nearly 5% of stocks have been swapped. It is one of the reasons that US 500 (S&P500) is recording good performance because the brands are regularly replaced and company’s other than strong companies are eliminated. In addition, the movement of US 500 (S&P500) has a direct influence on the stock price movements of other countries. Although the price movement is in a form dragged by US 500 (S&P500), it is inferior to the performance of US 500 (S&P500).

Although the presence of China, which is becoming an economic power in recent years, is conspicuous, the current situation is that there are not many companies representing the world like the United States. It is still expected that the center of the world economy will be the United States and the stock index will move around the United States as well. Because US 500 (S&P500) understands the economic situation of the United States in real time, the prospects of the world economy is easy to attach. It is also recommended that beginners with short investment history learn the movement of the economy.