Trade Volatility Indices & Crash Boom Indices on MT5
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Deriv Synthetic Indices on MT5 Review
Synthetic Indices are simulated market which can be traded 24/7. They come in different types, simulating different kinds of market conditions, including volatility (for example Volatility Indices) and falling and rising markets (Crash Boom Indices). Deriv offers a wide range of these Indices to trade on MetaTrader 5 (MT5).
The trader can open a Synthetic Indices account from the 'Trader's hub' on the Deriv platform. Synthetic Indices are offered in the 'Derived' account. The MT5 Derived account has the widest range of Synthetic Indices. Thus if the trader wants to try different kinds of Synthetic Indices, they may wish to open an MT5 Derived account.
The Derived account used to be called the Synthetic account. The Derived account offers Derived Indices (based on Forex) and Basket Indices (based on Forex and Metals) to trade, as well as Synthetic Indices. If the trader wishes to start by signing up with Deriv they can do so here: Deriv Sign-Up.
| Feature | Description |
|---|---|
| Synthetic Indices Trading Type | MT5 offers a wide range of Synthetic Indices, including Volatility and Crash/Boom Indices. Synthetic Indices simulate different types of market conditions, such as different levels of volatility and rising, falling and ranging markets, which the trader can select Description |
| Margin Trading Account Feature | On MT5, Synthetic Indices are offered to trade on margin with leverage up to 1000:1 and trade sizes down to 0.001 lots on selected markets Description |
| Minimum Deposit Account Feature | MT5 accounts are created from the main Deriv account. There is no minimum deposit to move funds into an MT5 account from the main Deriv account and a $5 minimum deposit to fund the Deriv account. Demo MT5 accounts can be created as well Description |
| 24/7 Trading Platform Feature | Traders may trade Synthetic Indices 24/7 as they are simulated markets and not based on real markets but on algorithms Description |
What is the difference between Synthetic and Volatility Indices ?
Synthetic Indices are a broader class of simulated markets and contain Volatility Indices. There are seven types of Synthetic Indices available on MT5, Volatility Indices, Crash Boom Indices, the Step Index, Range Break Indices, DEX Indices, Drift Switching Indices and Jump Indices. There are also more types of Synthetic Indices on MT5 compared with the other platforms offered on Deriv.
On Deriv MT5, Volatility 10, Volatility 10 (1s), Volatility 25, Volatility 25 (1s), Volatility 50, Volatility 50 (1s), Volatility 75, Volatility 75 (1s), Volatility 100 and Volatility 100 (1s), Volatility 150 (1s), Volatility 200 (1s), Volatility 250 (1s) and Volatility 300 (1s) Indices are offered.
The Volatility (1s) Indices update faster, that is one tick every second, versus one tick every two seconds for the other Indices (ticks are each minimum move of the Index). The increase in number in the Volatility Indices refers to an increase in volatility of the Index. Thus it can be seen that MT5 provides a wide range of choice in terms of Volatility Indices. To access these and all markets available from an MT5 account, the trader clicks on the Symbol tab, which brings up all markets on the platform.
What other Synthetic Indices are available on MT5 ?
Crash Boom Indices are offered which come in two types (Boom or Crash). As the name suggest these simulate rising and falling markets. The Crash Indices come in three types, the Crash 1000 Index, the Crash 500 Index and the Crash 300 Index. The Crash 500 Index has on average 1 drop in the price series every 500 ticks, the Crash 300 Index has on average one drop in the price series every 300 ticks, while the Crash 1000 Index has on average one drop in the price series every 1000 ticks.
The Boom Index also comes in three types, the Boom 1000 Index, the Boom 500 Index and the Boom 300 Index. For the Boom 500 Index there is on average 1 spike in the price series every 500 ticks, for the Boom 300 Index there is on average 1 spike in the price series every 300 ticks and for the Boom 1000 Index there is on average 1 spike in the price series every 1000 ticks.
What is the Step Index ?
The Step Index simulates a market step by step. It has an equal probability of going up or down with a fixed step of 0.1. The idea of the Step Index is to smooth out jumps in price action.
What are the Range Break Indices ?
The Range Break Indices break the range the Index moves in either once every 200 attempts on average (the Range Break 200 Index) or once every 100 attempts on average (the Range Break 100 Index).
What are the Jump Indices ?
The Jump Indices come in five types. These are the Jump 10 Index, the Jump 25 Index, the Jump 50 Index, the Jump 75 Index and the Jump 100 Index. Each Jump Index has three jumps per hour. The figure (10, 25, 50, 75 or 100) refers to the volatility of the Index.
What are the DEX Indices ?
The DEX Indices aim to simulate the way markets may respond to news events. There are frequent small drops or jumps but on average a major spike or drop every 600, 900 or 1500 seconds. The DEX Indices come in six types.
The DEX 600 UP Index has small drops and a major spike on average every 600 seconds. The DEX 600 DOWN Index has small spikes and a major drop on average every 600 seconds.
The DEX 900 UP Index has small drops, and a major spike on average every 900 seconds. The DEX 900 DOWN Index has small spikes, and a major drop on average every 900 seconds.
The DEX 1500 UP Index has small drops and a major spike on average every 1500 seconds. The DEX 1500 DOWN Index has small drops and a major spike on average every 1500 seconds.
What are the Drift Switching Indices ?
The Drift Switching Indices simulate action around trends. They have three phases: upwards, downwards and sideways. The Indices switch between these phases on average every 10, 20 or 30 minutes, and thus come in three types: Drift Switch 10, Drift Switch 20 and Drift Switch 30.
Real vs Demo Account
While the trader can create a Real account, they may also create Demo accounts. These can used to test out these Indices and try out ideas and strategies, without risking real money. The Derived Demo accounts can be created from the Trader's hub. Deriv Demo.
Basket Indices
Basket Indices are an addition to the MT5 Derived account. They are not Synthetic Indices and cannot be traded at weekends, but can be traded around the clock from Monday to Friday (with the exception of Gold, which has an hour's break each day). Basket Indices are CFDs on currencies or metals (Gold) versus an equally weighted basket of other currencies.
Derived Indices
These are Forex Indices which are based on real markets but with a volatility of 10%. The idea is to provide market based value but insulated to some extent from real world events. They can be traded 24 hours from Monday to Friday.
Where to find the MT5 Derived account on Deriv
Synthetic Indices are offered on MetaTrader 5 and on other platforms at Deriv, however MT5 has an account focused on Synthetic Indices, called the Derived account on the Deriv platform (it also offers Derived Indices for Forex and Basket Indices for Forex and Metals). This account and the platform is available from the Trader's hub tab on Deriv. Some countries may have restrictions on trading Synthetic Indices on MT5. Binary.com has rebranded and moved to Deriv, which offers Synthetic Indices trading on Binary.com's platforms including MT5 and additional platforms.
| Broker, Feature & Trading | Description |
|---|---|
| Deriv Broker | Deriv is the rebranding of Binary.com and offers Binary.com's platforms (and more) in a user friendly interface. Binary.com has moved to Deriv What Is Deriv |
| Deriv Synthetic Indices Feature | MT5 Synthetic Indices trading is available on Deriv on the MT5 Derived account and the trader may trade Synthetic Indices on the MT5 web trader, on MT5 desktop download and on MT5 mobile as well as on Deriv's other platforms like Deriv X Where To Trade Synthetic Indices |
| Trade Synthetic Indices Trading | The trader can open an MT5 Derived account from the Trader's hub on the Deriv Platform, after they have signed up to Deriv How To Open A Synthetic Indices Account |
Deriv offers Synthetic Indices on a wide range of platforms
Deriv combines different platforms which were offered by Binary.com (and other platforms) into one suite of platforms, along with mobile apps. As well as MT5 it features DTrader, which is a user friendly platform, DBot which lets the trader build trading robots, SmartTrader, Deriv X and Deriv Go and Deriv EZ.
Synthetic Indices are included on Deriv, in addition to other markets to trade. As well as on MT5, the trader may also trade Synthetic Indices on Deriv's other platforms (DBot, DTrader, SmartTrader, Deriv GO, Deriv EZ and Deriv X).
What MT5 platforms are available ?
The Synthetic Indices MT5 account (the MT5 Derived account) is found in the 'CFDs' part of the Trader's hub. The trader can trade via this account on a web trader and also download MT5 desktop and mobile from here and trade Synthetic Indices on these platforms. Desktop MT5 has more features than the web trader and MT5 mobile is a user friendly platform for mobile trading.
If the trader wishes to try Deriv, they may create a Deriv account. Deriv.
Is there a commission charge ?
There is no commission charge to trade Synthetic Indices. For overnight positions, a swap rate is charged.
Are spreads fixed or variable ?
It depends on the Synthetic Index. Most are fixed, however the Crash Boom Indices and the Jump Indices have floating (variable) spreads.
| Synthetic Index | What Is It |
|---|---|
| Volatility Indices Synthetic Index | Volatility Indices simulate different levels of market volatility and come in Volatility 10, 25, 50, 75 and 100 Indices and also as (1s) versions, which update faster (the (1s) versions also include Volatility 150, Volatility 200, Volatility 250 and Volatility 300 Indices) What Is It |
| Jump Indices Synthetic Index | The Jump Indices have different volatility (Jump 10, Jump 25, Jump 50, Jump 75 and Jump 100 Indices) but each jumps three times per hour What Is It |
| Crash Boom Indices Synthetic Index | Crash Boom Indices simulate crashing or booming markets and come in Crash 300, Boom 300, Crash 500, Boom 500 and Crash 1000, Boom 1000 types What Is It |
| Step Index Synthetic Index | The Step Index simulates a market step by step, with each tick having an equal probability of being up or down What Is It |
| Range Break Indices Synthetic Index | The Range Break Indices break the range the market moves in once on average either every 100 attempts (the Range Break 100 Index) or once every 200 attempts (the Range Break 200 Index) What Is It |
| DEX Indices Synthetic Index | The DEX Indices simulate a market reacting to news events. The DEX 600 UP, DEX 900 UP and DEX 1500 UP Indices have small, frequent drops and major spikes up on average every 600, 900 or 1500 seconds while the DEX 600 DOWN, DEX 900 DOWN and DEX 1500 DOWN Indices have small, frequent spikes and major drops on average every 600, 900 or 1500 seconds What Is It |
| Drift Switching Indices Synthetic Index | The Drift Switching Indices simulate trends, switching between upwards, downwards and sideways movement on average every 10 minutes (Drift Switch 10), 20 minutes (Drift Switch 20) or 30 minutes (Drift Switch 30) What Is It |
What order execution is available ?
Order execution is market execution, thus there are no requotes.
What is it like to trade Synthetic Indices ?
They are similar to trading any market, in that the trader is trading on movements on a chart on a trading platform and can use trading tools to analyse these markets. One difference is that the trader may select characteristics of these markets such as volatility, or simulate Booming or Crashing markets, which is not possible with real markets. However these are simulated, not real markets and characteristics of real markets may be different or absent from these Indices.
Expert Advisors
On the MT5 desktop download, the trader can find Expert Advisors (EAs) from the Navigator window. These are online trading robots which will execute trading strategies on behalf of the trader, for example based on indicator signals. There are a number of pre-built EAs provided on MT5. EAs may run 24/7 but can also create losses rapidly in the trader's account.
What is the minimum deposit ?
The trader first creates a Deriv account in a chosen currency. Then they create the MT5 Derived account, to trade Synthetic Indices on MT5. This is in USD. So the trader funds their USD MT5 account from (and withdraws to) their base account. There is no minimum deposit to fund MT5, but there is a minimum of $5 which can be sent from payment providers to fund the fiat account.
The maximum deposit varies depending on the payment method, for example the maximum deposit by credit/debit card is $10,000. If traders wish to deposit larger sums, then Bank Transfer allows a maximum deposit of $100,000. The minimum withdrawal is $5 but can vary depending on the payment method.
Analysing Synthetic Indices
MT5 has a range of tools for analysing market including technical indicators. Technical indicators were designed for real markets however they can be used to analyse Synthetic markets. As with any market, analytical tools do not predict, but may provide a basis for making a trade. The Indices form patterns as well, providing another basis for analysing these markets. The trader can use chart price types such as candlestick charts if they wish, and thus use the wide range of analysis techniques based on these, such as candlestick chart analysis. MT5 in fact has an expanded range of tools compared with the basic MT4, including more inbuilt technical indicators, graphical objects and time frames.
What is the minimum trade size ?
These vary depending on the Index. The minimum trade size is 0.001 lots which is offered for the Volatility 75 Index. Other Indices offer higher minimum trade sizes.
Deriv X
Deriv X is a user friendly platform which offers an account for trading Synthetic Indices on margin. It is essentially an improved web trader for trading Synthetic Indices complementing MT5 and has a similar set of Synthetic Indices as are offered on MT5 (though more are on MT5). Deriv X is available from the Trader's hub on the Deriv platform (like MT5).
What is the maximum leverage ?
The maximum leverage is 1000:1, meaning the trader can trade with smaller account sizes if they wish, especially given the minimum trade size available. Increasing leverage increases risk but the trader can reduce their exposure by lowering the order size.
What times can the trader trade these markets ?
The Volatility, Crash Boom, Jump, Range Break, DEX and Drift Switching Indices and the Step Index can be traded continuously, 24/7.
Payment Methods
Deriv offers a wide range of payment methods, but availability depends on the trader's region. These include Wire Transfer, Credit/Debit Cards, Neteller, Skrill, Jeton, EPS, Giropay, Przelewy24, Rapid Transfer, FasaPay, Perfect Money, WebMoney, Paysafecard, STICPAY, Airtm, Boleto, Pay Livre, Trustly, 1ForYou, Advcash, Paytrust, Help2Pay, DragonPhoenix, ZingPay, NganLuong, Changelly, Banxa, Xanpool and Deriv P2P. Which methods are available can be seen from the Cashier tab. In some regions, Crypto is available as well for deposits and withdrawals and accounts are offered denominated in Cryptos or fiat. Crypto accounts have no minimum deposit. Withdrawal requests are normally processed within 24 hours, and can be faster than this.
Summary
Synthetic Indices offer a way to trade simulated markets, which are available to trade 24/7. The trader may trade Volatility Indices, a subset of Synthetic Indices on a range of platforms offered by Deriv (formerly Binary.com). However they can find a full complement of Synthetic Indices on MetaTrader 5, allowing the trader to trade these markets using the tools offered by this advanced trading platform (MT5 is the successor to MT4).
The trader can trade Synthetic Indices with MT5 on Deriv. The trader may trade Synthetic Indices on an MT5 web trader, MT5 desktop or user friendly MT5 mobile. The trader can use the analysis tools provided on the platform, with the caveat that these are not real markets.
There is no minimum deposit requirement, leverage is 1000:1 (increasing leverage increases risk) and there are low minimum trade sizes on selected Indices, letting the trader reduce their exposure. The trader may create demo accounts to practice trading and try out ideas.
