Ever noticed how traditional financial markets seem to have a mind of their own, jumping up and down based on world events? Well, what if you could trade purely on market movement itself, without worrying about breaking news or economic surprises? That’s exactly what Deriv’s Volatility Indices offer-a chance to trade price fluctuations in a controlled, simulated market. 

Let’s break it down!

What are Volatility Indices?

Volatility Indices are synthetic trading instruments that mimic market movements at fixed volatility levels. Unlike traditional stocks or forex pairs, these indices aren’t influenced by global events, making them a unique and stable option for traders.

How do they work?

Deriv uses a random number generator to create smooth and predictable price movements that adhere to set volatility levels. This means traders can focus purely on price action and technical strategies without external disruptions.

Exploring volatility levels: What’s your style?

Deriv offers Volatility Indices with different volatility levels, ranging from 10 to 250. The higher the number, the more movement in price action. Here’s what you need to know:

One-second ticks (1s): More frequent, smaller price changes for fast-paced trading.
Two-second ticks: Larger price movements at a slower pace, ideal for strategic trades.

Pro Tip: Even if two indices share the same volatility level (e.g., Volatility 10 (1s) vs. Volatility 10), their prices move independently.

Why trade Volatility Indices?

Volatility Indices offer several perks that make them stand out from traditional assets:

• Trade Anytime: Available 24/7-yes, even on weekends!
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• No External Influence: Market news, central banks, or corporate earnings won’t impact price movements.
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• Fair Trading Environment: No big players manipulating the market.
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• Predictable Spreads: Transparent and stable cost structures.
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• Variety of Risk Levels: Choose between lower volatility (less movement) or higher volatility (more action) to match your strategy.
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Trading Volatility Indices: Pick your strategy

Trading Volatility Indices is all about choosing the right approach. Here are two main trading methods:
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Contracts for difference (CFDs)

With CFDs, you don’t own the index-you simply predict whether the price will rise or fall. This allows for short-term trading, and you can use leverage to increase potential profits. But remember, leverage also increases risk!
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Options trading

Options let you speculate on price movements with a predefined risk. You decide your stake upfront, so you never lose more than you put in.
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Key differences:

• CFDs: Continuous trading, higher potential rewards (and risks).
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• Options: Fixed risk, structured payouts, some contracts have expiration times.
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Where can you trade Volatility Indices?

Deriv offers several platforms designed for different trading styles:
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For CFD traders:

Deriv MT5: Advanced tools for detailed technical analysis.
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Deriv cTrader: Beginner-friendly with a “copy trading” feature.
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Deriv X: Customizable dashboards for a personalized experience.
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For Options traders:

 Deriv Trader: Simple and easy for newcomers.
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Smart Trader: Guided trades for confidence-building.
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Deriv Bot: Automate your trades with custom strategies.
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Deriv GO: Trade on-the-go with a mobile-friendly platform.

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Learn more about the Volatility Indices by signing up for this free course or practice your skills with a free demo trading account and start exploring Deriv's Volatility Indices across its various platforms today.

Ready to start trading?

Now that you understand Volatility Indices, it’s time to put your knowledge to the test! Open a Deriv trading account today and explore the world of synthetic market trading like a pro. 

 Sign up now and start your journey!

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