S&P/ASX 200 Resources Index
What is the S&P/ASX 200 Resources Index?
The S&P/ASX 200 Resources Index sector is a sub-index of the S&P/ASX 200 Index. This index is specifically created for the resources sector of the Australian equity market. Resources are companies that are classified as energy sector stocks along with companies that are classified in the metals and mining Industry.
Uses of the S&P/ASX 200 Resources Index
As with all indices, the S&P/ASX 200 Resources Index can be traded outright by going long (if you expect the sector to go up), or short (if you expect the sector to go down). Investors are also able to use this index to hedge their investment portfolio.
Risks of the S&P/ASX 200 Resources Index
Like any index, there are risks in trading the Resources Index. This risk involves economic events such as business cycles, macro and micro risks that may include a downturn in the economy such as a recession, poor company results or a fall in demand of products produced.