How to trade the DAX (GER40): the 40 members, total return, Xetra hours and risk

Trading GER40 means trading a CFD on the DAX, the index of the 40 largest and most liquid companies listed on the Frankfurt Stock Exchange. Two features make it different from the US indices: it is a total return index, so dividends are assumed to be reinvested rather than causing the index to drop, and it is priced in euros. Its cash session runs on the Xetra trading system from 09:00 to 17:30 Frankfurt time, but most providers quote GER40 for far longer, using DAX futures.

This guide covers the index, its rules and its behaviour. For the full sizing method, including converting a euro-denominated value per point into a dollar or sterling account, see index CFD position sizing; there is only a short example here.

What the DAX is

The DAX (Deutscher Aktienindex) was launched on 1 July 1988 with a base value of 1,000 points, set as of the end of 1987. It is owned by Deutsche Börse and administered by STOXX, the group's index business. For most of its life it contained 30 companies, which is why older platforms and many traders still call the CFD GER30. Since 20 September 2021 it has contained 40, and most providers have renamed the contract GER40 or DE40.

Typical heavyweights include software, industrial engineering, insurance, telecoms, carmakers, chemicals and pharmaceuticals companies, names such as SAP, Siemens, Allianz and Deutsche Telekom. Many of them earn most of their revenue outside Germany, so the DAX is better thought of as a basket of global companies headquartered in Germany than as a measure of the German economy.

Our guide to what a stock index is explains index construction in general.

The 2021 reform: from 30 to 40

The expansion was part of a wider rule change. It followed the collapse of Wirecard, a payments company that filed for insolvency in June 2020 while it was still a DAX member, which led to criticism of how the index chose and kept its members. The main changes were:

• 40 members instead of 30, with the next index down, the MDAX, reduced from 60 to 50 members.
• Ranking by free-float market capitalisation only. Previously, trading turnover was also a ranking criterion; now a minimum liquidity level is a filter instead.
• A profitability test. New entrants must show positive EBITDA (earnings before interest, tax, depreciation and amortisation) in their two most recent annual reports.
• Reporting standards. Members must publish audited annual and quarterly reports on time and meet governance requirements, such as having an audit committee.
• A 10% cap on the weight of any single member.

Reviews take place quarterly, in March, June, September and December, with fast-entry and fast-exit rules for companies that rise far up or fall far down the rankings. When members change, index funds and futures traders rebalance, which can produce heavy volume in the affected shares around the effective date. Our guide to index rebalancing covers that.

Why it is a total return index

Most indices traders know, including the S&P 500, the Dow and the FTSE 100, are price indices. When a member pays a dividend, its share price falls by roughly the dividend on the ex-dividend date, and the index dips slightly as a result.

The headline DAX is a performance index, the German term for a total return index. Its calculation assumes that dividends are reinvested in the index, so the ex-dividend price drop is offset and the index level does not fall because of it. Deutsche Börse also publishes a price-only version, the DAX Kursindex, which sits at a much lower level because it has never added dividends back.

What this means in practice

• The DAX level includes decades of reinvested dividends. That is one reason it has risen to a much higher number than its 1988 base would suggest. Comparing its long-run chart with a price index such as the Euro Stoxx 50 or the FTSE 100 is not a like-for-like comparison.
• Cash GER40 CFDs usually have no dividend adjustments. On a price index CFD, long positions are credited and short positions debited when members go ex-dividend. On a total return index there is no ex-dividend drop to compensate for, so providers usually make no adjustment. Check your provider's terms.
• Spring is not a special case for the DAX. German companies tend to pay annual dividends after their annual general meetings, which cluster in spring. Price indices with many German members, such as the Euro Stoxx 50, show the effect; the DAX does not.

Our guide to dividends and corporate actions explains dividend adjustments on CFDs in more detail, and trading index CFDs covers the rest of the contract mechanics.

When GER40 trades

The Xetra cash session

The DAX is calculated from prices on Xetra, Deutsche Börse's electronic trading system. Continuous trading runs from 09:00 to 17:30 Frankfurt time (CET or CEST), with an opening auction before and a closing auction after. That is 08:00 to 16:30 UK time for most of the year. During this window the index is updated continuously and liquidity is deepest.

Key moments in the day include:

• 09:00 Frankfurt. The cash open, usually the most active part of the European morning.
• 10:00 Frankfurt. German and euro area data releases, such as the Ifo business climate survey or PMIs, often fall in the morning.
• 14:30 Frankfurt (most of the year). Major US data such as payrolls and CPI arrive at 08:30 New York time, and the DAX reacts to them.
• 15:30 Frankfurt. The US cash open, often a second burst of activity.
• 17:30 Frankfurt. The Xetra close and closing auction.

For a few weeks in March and in October or November the gap between Frankfurt and New York is one hour shorter than usual, because the US and Europe change their clocks on different dates. The market hours tool shows the sessions in your own time zone.

Outside Xetra hours

DAX futures trade on Eurex for much longer than the cash market, from early in the European morning to late in the evening. Many providers quote GER40 for most of that time, often from around 01:00 Frankfurt time to 22:00, though hours vary by provider. Outside 09:00 to 17:30 the CFD is priced from futures, liquidity is thinner and spreads are usually wider.

German public holidays such as Good Friday, Easter Monday and Christmas close Xetra; on some other days the exchange is open while other countries are closed. Your provider publishes its own holiday schedule for GER40.

What moves the DAX

• Global trade and China. Many DAX members sell machinery, cars, chemicals and software abroad. News about tariffs, global growth or demand from China often moves the index more than German domestic data.
• The euro. A weaker euro makes German exports more competitive and increases the euro value of foreign earnings, which can support the index; a stronger euro can do the opposite. The relationship is loose and changes over time. Our EUR/USD profile covers what drives the currency.
• The European Central Bank. ECB rate decisions and guidance affect borrowing costs, the euro and bank shares. See central banks and interest rates.
• German and euro area data. The Ifo and ZEW surveys, PMIs, industrial production and inflation figures.
• Energy prices. Germany's industry is energy-intensive, and the 2022 gas price shock after Russia's invasion of Ukraine weighed heavily on parts of the index.
• Wall Street. US data and the US session often set the direction for European indices in the afternoon, and overnight moves in US futures shape the European open.
• Earnings. With only 40 members and the largest capped at 10%, a big result from a heavyweight can move the index noticeably.

None of these links is fixed. The same piece of news can move the DAX in either direction depending on what was expected.

How GER40 CFDs work

• Points. GER40 moves in index points, quoted to one or two decimals.
• Value per point per lot. Set by the broker and denominated in euros. Conventions of 1 euro and 25 euros per point per lot are both common, among others.
• Currency. Profits and losses are in euros and are converted into your account currency. If your account is in dollars or pounds, the value of a point to you changes as EUR/USD or EUR/GBP moves.
• Cash or futures-based. Cash contracts carry overnight financing based on a euro interest rate benchmark; futures-based contracts expire and build financing into the price.
• Leverage. The DAX is one of ESMA's major indices, so EU retail clients can be offered up to 20:1, a 5% margin requirement.

A short sizing example in a dollar account

Illustrative numbers only, including the exchange rate. Account 10,000 dollars, risk 1% = 100 dollars. GER40 is at 19,000, your stop is 70 points away, and the broker's contract is 1 euro per point per lot with a 0.01 lot step. EUR/USD is 1.1000, so 1 euro per point is worth 1.10 dollars per point.

• Lots = 100 ÷ (70 × 1.10) = 1.2987, rounded down to 1.29 lots.
• Money at risk = 70 × 1.10 × 1.29 = 99.33 dollars.
• Notional value = 19,000 × 1 euro × 1.29 = 24,510 euros.
• Margin at 5% = 1,225.50 euros, or about 1,348 dollars at 1.1000.

If your account is in euros, no conversion is needed: 100 ÷ 70 = 1.428, rounded down to 1.42 lots. The index CFD sizing guide covers sterling accounts too, and the position size calculator and margin calculator do the arithmetic with your broker's figures.

Costs

• Spread, usually tightest during Xetra hours and widest early in the morning, late in the evening and around news.
• Commission, on some account types.
• Overnight financing on cash positions. With no dividend adjustments to offset it, financing is the main holding cost. The swap calculator can help estimate it.
• Currency conversion of euro profits and losses into your account currency, if your provider charges for it. See currency conversion and account base currency.

GER40 compared with other European indices

Traders who follow European shares usually look at several indices, and the DAX is easier to read once you know how it differs from the others.

• Euro Stoxx 50. Large companies from across the euro area, including several German heavyweights. It is a price index, so it drops on ex-dividend dates, and it has a broader mix of countries and sectors. Our Euro Stoxx 50 guide covers it.
• CAC 40. France's main index, with a heavier weighting in luxury goods, energy and banks. It often moves with the DAX but reacts differently to sector news.
• FTSE 100. Priced in pounds, heavier in energy and mining, and a price index. See our FTSE 100 guide.
• MDAX. The 50 German companies below the DAX, which tend to be more focused on the domestic economy.

When the DAX moves very differently from the Euro Stoxx 50 on a given day, the reason is usually news about a large German member, or a sector such as autos or chemicals that is more heavily represented in Germany.

A pre-trade checklist for GER40

1. Check the calendar for ECB decisions, German and euro area data, and US data at 14:30 Frankfurt time. Our guide to using an economic calendar helps.
2. Know which session you are in. Before 09:00 or after 17:30 Frankfurt time, expect wider spreads.
3. Convert the value per point if your account is not in euros, and redo the calculation when the exchange rate moves.
4. Measure the range. Base your stop on the recent daily ATR, not on a fixed number of points.
5. Confirm the contract terms, including any dividend treatment, financing rate and holiday hours.

Common mistakes with GER40

• Treating GER30 and GER40 as different markets. Both labels refer to the DAX. Older symbols were simply never renamed by some providers. Check the description.
• Comparing the DAX's long-run chart with price indices. The DAX's level includes reinvested dividends; the FTSE 100's and S&P 500's do not.
• Forgetting the euro. In a dollar or sterling account, your risk per point moves with the exchange rate. Recalculate rather than reusing old sizes.
• Trading the early session as if it were the cash session. Before 09:00 Frankfurt time, the CFD is priced from futures with thinner liquidity and often wider spreads.
• Ignoring US data. The DAX regularly reacts more to US payrolls or CPI at 14:30 Frankfurt time than to German releases.
• Over-leveraging. A 5% margin requirement means a 5% move against you consumes the whole deposit for that position. Most retail CFD accounts lose money; see why most retail CFD traders lose.
• Ignoring gaps. Weekend news and big announcements can move the reopening price through your stop. See gap risk and weekend risk.

Frequently asked questions

Is GER40 the same as the DAX?

GER40 is a CFD whose price is based on the DAX, normally via DAX futures. During Xetra hours a cash GER40 contract tracks the index closely; outside them it follows futures. You trade a contract with your provider, not the index or its shares.

Why is the DAX called a total return index?

Because its calculation treats dividends as reinvested in the index. When a member pays a dividend, the share price drop is offset in the index calculation, so the DAX does not fall on ex-dividend dates. Most other major indices are price indices, which do fall slightly when members go ex-dividend.

What are the DAX trading hours?

The Xetra cash session runs from 09:00 to 17:30 Frankfurt time, which is 08:00 to 16:30 UK time for most of the year. DAX futures on Eurex, and most GER40 CFDs, trade for much longer, roughly from early morning to late evening Frankfurt time, with exact hours set by each provider.

When did the DAX change from 30 to 40 companies?

On 20 September 2021. The change was part of a reform that also introduced a profitability requirement for new members, stricter reporting rules, ranking by free-float market capitalisation and a 10% cap on any single company's weight.

Does the euro affect the DAX?

Often, though not consistently. A weaker euro can help exporters and raise the euro value of overseas earnings, while a stronger euro can weigh on them. For a trader with a non-euro account there is also a direct effect: GER40 profits and losses are in euros, so their value in your currency moves with the exchange rate.

Is the DAX more volatile than the S&P 500?

It can be, partly because it has far fewer members and a heavier tilt towards cyclical industries, and partly because it reacts to both European and US news. Volatility varies a lot over time, so check a recent measure such as the daily ATR rather than relying on a general rule.