Boom and crash indices are synthetic indices from Deriv that are programmed to reflect rising and falling real-world monetary markets.
In other words, they behave specifically like a rising (booming) or falling (crashing) financial market.
There are six types of boom and crash indices namely:
| Boom Indices | Crash Indices |
|---|---|
| Boom 300 Index | Crash 300 Index |
| Boom 500 Index | Crash 500 Index |
| Boom 1000 Index | Crash 1000 Index |
A boom signifies a sudden surge in the market, often resulting in a movement of 50-60 pips.
In the Boom Indices, the prices predominantly follow a downward trend, but occasionally, a sharp upward spike occurs. Traders can profit from predicting these upward spikes.
A crash signifies a sudden drop in the market, often resulting in a movement of 50-60 pips.
In the Crash Indices, the prices predominantly follow an upward trend, but occasionally, a sharp downward spike occurs. Traders can profit from predicting these downward spikes.
Key Characteristics of Boom & Crash Indices:
Deriv is the only broker that offers boom & crash indices because it owns the algorithm that moves these indices. No other broker has access to the algorithm.
In other words, Deriv is the only
Lot sizes determine the trade size you can place. Below are the minimum crash boom indices lot sizes.
| Boom Indices | Crash Indices | Minimum Lot Size |
|---|---|---|
| Boom 300 Index | Crash 300 Index | 0.20 |
| Boom 500 Index | Crash 500 Index | 0.20 |
| Boom 1000 Index | Crash 1000 Index | 0.20 |
You can deposit as little as $1 to your synthetic indices account. However, you will not be able to tradecrash boom indices with such a low account balance.
The margin requirements and the minimum lot sizes needed to trade boom and crash will not allow you to place trades with such a low balance.
Below are the margin requirements and the minimum account deposit needed to trade the different boom and crash indices.
| Boom & Crash Index | Margin requirements for 0.2 lot size | Minimum advisable account balance required |
|---|---|---|
| Boom 1000 Index | $6.01 | $10 |
| Boom 500 Index | $2.51 | $5 |
| Crash 1000 index | $3.53 | $5 |
| Crash 500 Index | $3.72 | $5 |
Yes, you can trade Boom and Crash indices with $10. However, trading with such a small amount requires careful risk management and understanding of the potential risks and rewards. Here are some tips to consider:
Calculating ticks on Boom and Crash indices involves understanding the price movement in these instruments. A tick represents the smallest possible price change. Here's how to calculate ticks:
Identify the Price Movement: Look at the price before and after the movement. For example, if the price moves from 1000.50 to 1001.00, the movement is 0.50.
Understand Tick Value: For Boom and Crash indices, the tick value is usually 0.01. This means that each tick represents a 0.01 change in price.
Calculate the Number of Ticks: Divide the total price movement by the tick value. Using the example above:
Here’s a step-by-step example to clarify:
So, in this example, the price movement from 1000.50 to 1001.00 is equal to 50 ticks.
Opening a synthetic indices trading account for trading boom and crash indices is a straightforward process. Follow these steps to get started:
Step 1: Visit the Deriv Website:
Go to the official Deriv MT5 sign-up page here.
Step 2: Sign Up
Click on the ‘Create free demo account' button on the page.
You can sign up using your email address, or you can use your Google or Facebook account for quicker registration.
Agree to the terms and conditions and click ‘Create free demo account‘.
Step 3: Verify Your Email:
After signing up, you will receive a verification email. Click on the link in the email to verify your address.
Step 4: Complete Your Profile:
Once your email is verified, log in to your new account and complete your profile by providing the required personal information, such as your name, date of birth, and address.
Also set your preffered account base currency.
Step 5: Verify Your Identity
For security purposes, Deriv requires you to upload documents to verify your identity and address. This could include a government-issued ID (like a passport or driver’s license) and a utility bill or bank statement. You can choose to verify the account later if you donty have the document at hand.
Get step by step instructions on how to verify a Deriv account here.
Step 6: Open a Synthetic Indices Account
Click on the (1) ”Trader's Hub option” on the top left of your dashboard. Then click (2) ‘Real‘ > (3) ‘CFD's‘.
Then choose the Deriv Standard Account. This account gives you access to synthetic indices and forex CFD's.
Choose the jurisdiction for your account.
Afterward, you will be prompted to set a password specifically for your real Deriv MT5 synthetic indices account. This password is exclusively for logging into your trading account on Deriv MT5 and is separate from your main Deriv account password.
After creating your account you will be prompted to transfer funds from your main Deriv account to your DMT5 synthetic indices account.
Step 7: Download MT5 & login
After completing Deriv real account registration mt5 you will now see the Deriv synthetic account listed with your login ID.
You will also get an email with your login ID that you will use to log in to the Deriv synthetic account.
Download the mt5 application for your device and log in.
Step 8: Start Trading
Once your account is funded, you can start trading boom and crash indices. Access the trading platform, select your preferred synthetic index, and begin trading.
You can get step by step instructions on how to open a synthetic indices account here.
High Volatility: Boom and Crash indices can experience rapid and significant price movements, providing opportunities for quick profits.
Availability: These indices are available for trading 24/7, allowing flexibility in trading times compared to traditional markets.
No Market Influence: They are synthetic indices not influenced by external market factors, such as economic data or geopolitical events, which can provide a more stable trading environment.
Short-term Trading: Suited for traders who prefer short-term trading strategies due to their frequent price movements and predictable spike patterns.
High Risk: Due to their volatility, trading Boom and Crash indices carries high risk. Prices can move sharply against traders, leading to substantial losses.
Artificial Nature: Since these indices are synthetic and not based on real market conditions, trading strategies used in traditional markets may not always apply effectively.
Liquidity Concerns: Depending on market conditions, liquidity can fluctuate, potentially affecting trade execution and pricing.
Complexity: Understanding the specific rules governing each index (e.g., frequency of spikes, tick size) requires familiarity and can be complex for beginners.
Emotional Impact: Rapid price movements and potential for quick gains or losses can lead to emotional trading decisions, which may undermine trading discipline.
The 3 Pips Synthetic Indices Strategy for Boom and Crash Indices involves using the Relative Strength Index (RSI) and a 200-period Exponential Moving Average (EMA). This strategy is designed for small account balances and emphasizes minimal market exposure to reduce risk.
No, you can't. You can only trade boom and crash indices on DMT5. Deriv, the only broker with volatility indices, only uses MT5 servers.
Only Deriv has boom and crash indices because it created the algorithm that runs them.
Crash and boom indices on Deriv are synthetic indices that simulate the performance of markets that experience significant volatility. These indices are generated using a random number generator, designed to allow traders to speculate on the direction of future price movements.
Deriv offers various Crash and Boom indices, including Crash/Boom 1000, which experiences a crash or boom every 1000 ticks on average; Crash/Boom 500, which experiences a crash or boom every 500 ticks on average; and Crash/Boom 300, which experiences a crash or boom every 300 ticks on average.
To trade crash and boom indices on Deriv, you will need to create a trading account and deposit funds. Once you have done so, you can open a trade by selecting the crash and boom index you want to trade, specifying the amount you want to trade, and choosing whether you want to buy or sell.
Crash and boom indices are highly volatile, and there is a significant risk of loss when trading them. It is important to understand the risks involved before you start trading and to use risk management tools such as stop-loss orders to limit your losses.
Trading crash and boom indices on Deriv offers several benefits, including 24/7 trading, low minimum trade sizes, and the ability to trade on both rising and falling markets.
Yes, Deriv offers leverage on crash and boom indices, which allows you to trade with a smaller amount of capital. However, leverage also increases the risk of losses, so it is important to use it wisely.
Yes, you can trade Boom and Crash indices with $10, but it requires careful risk management and understanding of potential risks and rewards. Be realistic with your profit expectations, as trading on a small account means low potential profits. Start with the minimum lot size and open just one position to avoid margin calls. Implement strict risk management strategies, such as setting tight stop-loss and take-profit orders. Ensure you understand how Boom and Crash indices work by practicing on a demo account before trading with real money. Lastly, keep emotions in check and stay disciplined to your trading plan.
