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Blog Posts — July 4, 2018

DAX Turns 30

It’s the uncontested benchmark for German stocks, but its 30th anniversary finds DAX covering a much wider scope.

DAX®, the iconic index for German blue chips, turns 30 this month.

The benchmark has grown both in value and in scope since 1988, coinciding with a deep transformation of the German, European and global financial and investment landscape. Throughout its history, DAX has preserved its rules-based ethos, precision and reliable methodology, and has become the undisputed reference for Europe’s largest economy and some of the region’s best-known brands.

Today, DAX is one of the world’s most recognizable equity benchmarks, and serves as underlying for more than 150,000 financial products. Futures contracts on the DAX consistently rank among the five most popular index futures globally.1

DAX debuted on Jul. 1, 1988 with a level of 1,163 points. It closed at 12,3062 in June this year, on a total-return basis, its most-widely publicized version. Despite some turbulent market times in the last three decades, the index has amassed a 958% total return in the period, or a compound annual growth of 8.5%, showcasing the strong development of Germany’s economy.

Perhaps symbolizing the solidity of Germany’s corporate sector, half of the 30 current members have been continuously included in DAX since its launch. Its constituents have a combined market capitalization of 1.22 trillion euros – or around 80% of the overall listed equity in Germany.

Growth in scope

But it’s the development of a DAX family and its expansion in the last 30 years that stand out. DAX has evolved from a barometer of Germany’s 30 largest and most liquid companies to a family of more than 400 indices – covering both the German and global markets and including regional, sector and strategy indices, as well as gauges of volatility and fixed income. This comprehensive suite serves as underlying for exchange-traded funds (ETFs) with €29 billion in assets under management.

Starting in 1996, the DAX family expanded to include MDAX®, and later SDAX® and TecDAX®, which track, respectively, mid-sized and small companies, and technology businesses.3 They allow investors to delve deeper into the German corporate network, one of the world’s largest and most diversified.

DAXsector and DAXsubsector for the domestic market were introduced in 2003, offering targeted exposure to companies with a specific sales focus. In addition, today the German scope of DAX equity indices provides access to a range of selection and all-share indices, and to gauges for the real-estate market.

From Germany to the world

In 2006, the DAX brand went international as the DAXglobal® suite of indices was introduced. They offer investors liquid access to global industries as well as to specific regions and individual countries, with a focus on emerging markets.

Expansion to fixed income

While REX® bond indices were introduced in 1991, the family saw further expansion in 2002 with the first eb.rexx® real-time indices for the German bond market, the world’s third largest.

The eb.rexx indices are tradable bond indices that track the market for the most liquid German government bonds while the REX indices offer a representative cross section of German state debt based on synthetic bonds. The fixed-income offering is completed by the EUROGOV® indices, which track German and French government bonds in euros.

Going beyond standard equity

Further innovation in portfolio allocation was the remit of the DAX family’s strategy indices, which track a varied list of approaches including minimum variance, dividend, leverage, risk control, derivatives and hedge for Germany and beyond.

The offering is completed by alternative indices, such as the VDAX-NEW® measure of German equity volatility.

Across the DAX family, the principles of maximum transparency, neutrality and independence are upheld. A methodology designed around replicability makes all the indices perfectly suited as underlying for derivatives, ETFs and structured products.

A new world for passive investments

The DAX family is backed by the operational capabilities and standing of Deutsche Boerse. The indices are operated by STOXX Ltd., which also oversees its own branded indices, including the EURO STOXX 50® Index of Eurozone blue-chip companies.

STOXX continues to expand its offerings, most recently empowered by the growing popularity of thematic, factor-based and sustainability strategies.

As the indexing world grows and evolves, the outlook for the DAX family is as auspicious as ever. The emergence and popularity of new, smart indices driven by big data, algorithms and deeper markets, means that passively-managed assets are gathering momentum. And so are innovative index solutions.

The next 30 years are likely to see this momentum continue, offering fresh opportunities for the DAX family to thrive as the German-born indices for the world.

Featured indices


Notional value in euros, Eurex data.
Total return in euros.
Following a market consultation, Deutsche Börse recently announced rule changes for the three indices, expanding MDAX and SDAX to include more constituents, and eliminating the divide between technology and so-called ‘classic’ stocks.