Frankfurt opens the cash market at 09:00 local time, and the DAX 40 futures have already been trading for hours. That gap between the futures session and the cash open is why the German index has a reputation among European day traders: the first fifteen minutes after the equity open regularly produce a range that the rest of the day struggles to beat.
The DAX tracks the 40 largest listed German companies by free-float market capitalisation and order book volume. It expanded from 30 constituents to 40 in September 2021, which broadened the sector mix and reduced the weight of the largest names. It also remains a performance index: dividends paid by constituents are reinvested into the index calculation, which is unusual among headline benchmarks and matters when you compare its long-run chart to a price index like the S&P 500.
An industrial index, not a technology one
Chemicals, industrials, carmakers, insurance and software make up the bulk of the DAX. Several of its largest members earn most of their revenue outside Germany, and a significant share of it in China and the United States. The index therefore reacts to global manufacturing demand and to the euro exchange rate as much as it reacts to German domestic conditions.
A weaker euro tends to help, because it raises the euro value of foreign earnings for exporters. Energy prices matter more here than in most Western indices, since German chemical and industrial production is energy intensive. When European gas prices spike, DAX underperforms its European peers, and the effect shows up in the index before it appears in company results.
Broker DAX 40 CFDs are usually priced off the futures contract, so quoted hours run far beyond the Frankfurt cash session. Overnight candles are thin, wide and easy to misread as a signal.
The early risers' schedule
The trading day has a rhythm that repeats often enough to plan around. German and eurozone data land at 07:00 or 08:00 UTC in winter time. The cash market opens an hour later and the opening auction sets the day's first reference levels. European volume then falls through the middle of the session before the US open reintroduces direction in the afternoon.
| Window (CET) | What tends to happen |
|---|---|
| 08:00 to 09:00 | German data releases, futures pre-position ahead of the cash open |
| 09:00 to 10:00 | Opening auction and the day's most active hour |
| 12:00 to 14:00 | Midday lull, thinner volume, ranges compress |
| 15:30 to 17:30 | US cash open pulls the DAX with it until the Frankfurt close |
The two releases that move the index most are eurozone inflation and the European Central Bank decision, followed by the German Ifo business climate and the ZEW sentiment survey. US inflation and Federal Reserve announcements move it too, because European equities take their afternoon direction from Wall Street. Traders working the first hour after the open often use the approach described in the London breakout guide, adapted to the earlier Frankfurt timetable.
Volatility, and what it costs to be wrong
The DAX has historically been one of the more volatile major European indices, with a large point value per index unit. That combination makes position sizing unforgiving. A stop placed a hundred points away on a DAX CFD represents a very different cash risk from a hundred points on a lower-priced index, and traders who move between instruments without recalculating lot size are the ones who get surprised.
Overnight financing applies to any position held past the daily rollover, and the index gaps between the Friday close and the Sunday futures reopen. The way to think about that exposure is the same as for any leveraged product: decide the cash amount you are prepared to lose first, then work backwards to the size. That order of operations is set out in the risk management rules.
Reading it alongside the rest of Europe
DAX rarely moves alone. It trades in close sympathy with the CAC and the Euro Stoxx, and divergence between them is usually sector news rather than a tradeable signal. What is worth watching is the DAX against US index futures during European hours: when Frankfurt sells off while US futures hold flat, the driver is European, and the move often fades at the US open. When both fall together, it is a global risk story and it tends to extend.
Bund yields are the other reference. Rising German yields pressure the rate-sensitive parts of the index, and the relationship tightens during ECB weeks. The broader mechanics of index products, including how brokers handle expiry and dividend adjustments, are covered in the indices guide. Leveraged index trading carries a high risk of loss, and the DAX opening hour is exactly the window where that risk is concentrated.
"The DAX opening hour is where most of the day's money is made and lost. If you are still deciding your size at nine in the morning, you have already lost the trade."
— Roman Onta, Executive Director, SINGUARD
Key Takeaways
- The DAX is a performance index: dividends are reinvested into the calculation, unlike most price indices.
- Its largest members are global exporters, so the euro rate and world manufacturing demand matter as much as German data.
- Energy costs hit the index harder than most Western benchmarks because of its industrial weighting.
- The point value is large, so lot sizes carried over from other indices produce very different cash risk.
Frequently Asked Questions
How many companies are in the DAX?
Forty, since the index expanded from thirty constituents in September 2021. Membership is based on free-float market capitalisation and order book volume, and the expansion broadened the sector mix while reducing the weight of the largest names.
Why is the DAX called a performance index?
Dividends paid by constituents are reinvested into the index calculation rather than being ignored. That makes long-run DAX charts look stronger than price indices such as the S&P 500, and it means the two are not directly comparable.
When is the DAX most active?
The hour after the Frankfurt cash open at 09:00 CET, and again from the US cash open at around 15:30 CET until the Frankfurt close. The middle of the European session is usually the quietest part of the day.
About the Author
Roman Onta is an Executive Director at SINGUARD. He builds the Prop Firm CRM, the Broker CRM, Scalegram and CopySignals side by side with his brother Alex Onta, and he helped on the design of eTrader, the division Alex built and leads. His ground is worldwide payment processing, AML compliance and the corporate structures brokers are built on, work the two of them carry together, shaped by executive roles in the UAE and international corporates. He lives and works in Dubai for most of the year. Meet the executive duo leading Singuard's five divisions.