If you are here, then you plan to get started with volatility indices trading, or just got started, right? This can be a lucrative opportunity for many people, and you can make a fortune from it, too.

However, there is a lot to learn about this opportunity. For now we will focus on volatility indices brokers. Read through this guide to find more insights.

What Are Volatility Indices?

Volatility Index, or VIX, is a synthetic instrument designed to measure the price fluctuation volatility of a real market. It is an annualized implied volatility of a real market. Most of us know about stock markets in the real world, and the volatility indices tend to copy these markets through their different categories of indices.

As such, there are popular volatility indices used by various volatility indices brokers. Here are some of the most popular ones:

  •       EURO STOXX 50 Volatility Index (VSTOXX) – Measures the European market volatility.
  •       VIX (CBOE Volatility Index) – Measures the volatility of the S&P 500.
  •       RVX (CBOE Russell 2000 Volatility Index) – Measures volatility for the Russell 2000 Index.
  •       VXN (CBOE Nasdaq-100 Volatility Index) – Measures volatility for the Nasdaq-100.
  •       VVIX (VIX of VIX) – Measures the volatility of the VIX.

Who Are Volatility Indices Brokers?

It is not easy to trade without the help of a middle person called a volatility indices broker. These are platforms that link investors to various volatility indices and allow them to trade.

Some volatility indices brokers are specialized and only deal with specific volatility indices while others are general. Furthermore, some are global while others are regional. Therefore, you should make insightful considerations when choosing volatility indices brokers.

How to Choose the Best Volatility Indices Brokers

You need to explore the profiles of reputable volatility indices brokers, such as Weltrade, and then narrow your choices down to the best one. It is best to make several considerations because a broker can determine your success or failure in volatility indices trading. Here are some considerations to make:

  •       The reputation of the broker – As you shortlist the best volatility indices brokers, ensure they have a good reputation. Some of the red flags to check for include fraud and insecurity cases, high commissions and hidden costs, and few indices, among others. Ensure that the broker of your choice has a great reputation.
  •       Security – Trading is a form of investment where some people inject a lot of money. Payment and all trading operations should have bank-level security. You can check for this with the broker, just to be certain.
  •       Listed volatility indices – Many reputable volatility indices brokers list popular instruments to remain competitive. However, you should confirm that your preferred index is available. Make sure that some other popular indices are available, just in case you need to diversify your trading.
  •       Cost of trading – How much does your preferred volatility indices broker charge for services? Do you think this is a concern? The commissions should be competitive. Ensure that they charge fairly for all of their services, especially if you plan to trade regularly.

Conclusion

Volatility indices brokers are essential because they allow traders to trade efficiently through a platform. Because these instruments are virtual, all trading is done online. This makes it easy to choose a broker and even trade on any device.