Trading synthetic indices
Complete guide for introducing brokers & partners
Welcome to your complete guide for promoting and understanding synthetic indices at ThinkMarkets. This guide was designed specifically for Introducing Brokers (IBs) and partners who want to understand how synthetic indices work, why they attract traders, and how you can successfully position them to your clients.
Contents
1. What are synthetic indices?
Synthetic indices are simulated trading instruments that mimic real market behavior. They are generated using advanced algorithms and Random Number Generators (RNGs) to simulate price action, volatility, and trend behavior.
They are not tied to real-world events, news headlines, central bank decisions, or geopolitical surprises. Instead, they are designed to provide traders with reliable volatility, 24/7 market access, and news-free technical setups.
Key Features:
- Up to 1:2500 leverage
- 24/7/365 trading (including weekends and holidays)
- No gaps or slippage from external news
- Volatility profiles you can rely on
2. RNG explained simply
At the core of every synthetic index is a Random Number Generator (RNG). RNGs produce unpredictable results, but within strict boundaries.
Each synthetic index uses RNGs guided by algorithmic rules that define:
- How often price "jumps" or "crashes"
- The range and direction of movement
- The volatility profile (e.g., 50%, 75%, 100%)
So, while prices aren't linked to world events, they do follow patterns, making them tradable, testable, and technical-strategy-friendly.
3. How synthetic indices work
Synthetic markets are powered by internal pricing engines. These engines replicate real market conditions, including trends, reversals, and volatility bursts, but in a closed, stable system.
No economic news
No price gaps from external events
No correlation
Independent of stocks, forex, or crypto
Predictable volatility
Consistent volatility levels you can count on
24/7/365 availability
Available exclusively on MT5 with full EA support
Available exclusively on MT5 with full support for EAs, indicators, and scalping strategies.
4. Synthetic vs traditional assets
| Feature | Synthetic indices | Traditional indices |
|---|---|---|
| Pricing source | Internal algorithm (RNG) | Real-world assets |
| Market hours | 24/7/365 | Limited to exchange hours |
| Affected by news? | ❌ Never | ✅ Heavily |
| Weekend gaps? | ❌ None | ✅ Common |
| Trading platform | MT5 | MT4/MT5/Exchange platforms |
| Designed volatility | ✅ Yes (pre-set) | ❌ No (naturally occurring) |
| Technical Trading | ✅ Perfectly suited | ✅ But may require fundamentals |
5. Why traders choose synthetics
6. Meet the thinkMarkets synthetic suite
Here's an overview of the synthetic instruments offered on MT5:
| Instrument | Volatility Profile | Special Feature |
|---|---|---|
| Volatility100 | 100% | Fastest-moving of the three |
| Volatility75 | 75% | Higher momentum than Core |
| Volatility50 | 50% | Steady daily movement |
| Volatility50 | 50% | Steady daily movement |
| Instrument | Volatility Profile | Special Feature |
|---|---|---|
| Jump100 | 100% | Wildest jump behavior |
| Jump75 | 75% | Higher frequency and volatility |
| Jump50 | 50% | Jumps every ~20 min (up or down) |
| Crash1000 | 50% | Mildest crashes, less frequent |
| Crash600 | 75% | Softer crashes, wider intervals |
| Crash300 | 100% | Regular sharp downward crashes (~300) |
| Boom1000 | 50% | Less frequent, lower magnitude booms |
| Boom600 | 75% | Moderate boom action |
| Boom300 | 100% | Sudden upward spikes (~300) |
Note:
The numbers (300/600/1000) indicate the average tick intervals between "event moments."
7. How to read the names
Each name includes:
- A type (Boom, Crash, Jump, Volatility)
- A volatility level or event frequency (e.g. 50, 75, 100)
- A number for frequency in Boom/Crash (e.g. Boom300 spikes every ~300 ticks)
These naming conventions help you choose the right instrument based on your trading style, whether you're looking for stability, volatility, spikes, or sudden moves.
8. Who re they ideal for?
Technical Traders
Who rely on charts, not headlines
Scalpers & Day Traders
Who want constant price action
Night/Weekend Traders
Needing 24/7 market access
Strategy Testers
Who want stable, consistent environments
Also ideal for traders burned by news whipsaws and unpredictable gaps in traditional markets.
9. Are they manipulated or controlled?
No. These markets are:
- Random within boundaries, governed by transparent volatility logic
- Not controlled manually - price moves follow pre-set algorithms
- Continuously monitored for fairness
- Globally regulated by trusted bodies to ensure transparency
At ThinkMarkets, we adhere to strict regulatory standards, giving you a safe, fair-trading environment. The synthetic indices pricing is derived by a highly regulated third-party provider.
10. How to get started on MT5
Create or log in to your ThinkMarkets account
Download MetaTrader 5 for desktop or mobile
Open a synthetic indices demo or live account
Choose from Volatility, Jump, Crash, or Boom indices
Add indicators, draw trendlines, and start trading
💡 Pro Tip:
Use the "Market Watch" panel in MT5 to locate all synthetic assets
11. How to position synthetics to clients
IBs can use the following talking points:
- Trade markets even when traditional ones are closed.
- More action, more often. Synthetics are designed for volatility.
- Low capital, high-leverage opportunities.
- MT5 support - full charting, EA-friendly, and mobile ready.
- Markets that never sleep. Literally.
- News-free environments perfect for pure technical setups.
- Perfect asset class for high-frequency traders.
12. Key benefits for IBs
High Trader Retention
Clients stay longer thanks to 24/7 access and fast-paced price action
More Trading Days
No weekends off means more commissions for you
Strong trader interest
New product class - easier acquisition
13. Resources and next steps
IBs can use the following talking points:
- Learn more about MT5 synthetic indices trading
- Explore our Trading Academy
- Try synthetic indices on a demo account
14. Frequently Asked Questions (FAQs)
Q: Do these indices move randomly?
A: They follow algorithmic rules that mimic real-world volatility. They are simulated market-like patterns.
Q: Are synthetic indices affected by economic news or central banks?
A: No. Synthetic indices are not linked to real-world economies. That means no surprise moves from central bank speeches, inflation prints, or geopolitical headlines.
Q: How is pricing calculated if there’s no underlying asset?
A: Prices are generated using algorithms and random number generators (RNGs) designed to simulate real market volatility patterns. The system is structured and predictable in its logic, not manipulated.
Q: Can synthetic indices be manipulated by brokers?
A: Y No. At ThinkMarkets, synthetic index prices follow fixed, transparent logic. These assets operate within regulated trading frameworks and undergo regular compliance reviews.
Q: Why are there different versions of Boom, Crash, and Volatility indices (300/600/1000)?
A: The numbers refer to the average tick intervals between major events like spikes or crashes.
For example:
- Boom 300: More frequent upward spikes
- Crash 1000: Less frequent but smoother drops
This gives traders flexibility to choose the volatility profile that fits their strategy.
Q: Can I automate my strategy on synthetic indices?
A: Yes! Our synthetic instruments run on MT5 and fully support EAs (Expert Advisors), indicators, scalping, and custom scripts, making them perfect for automation and backtesting.
Q: What’s the best time of day to trade synthetics?
A: Since synthetic markets operate 24/7, there's no fixed "market open/close" rhythm. Many traders prefer quiet times to avoid spikes, while others target high-volatility periods. Your strategy should guide your timing.
Q: Are these assets suitable for beginners?
A: While synthetics can be great for learning technical setups, they move fast. Beginners should always start on a demo account, learn the behavior of each instrument, and trade small until confident.
Q: Why should I offer synthetics to my clients as an IB?
A: Synthetic indices attract active traders who seek consistent opportunity, including weekends. That means:
- Higher retention
- More volume
- Stronger commissions
It’s a unique asset class to diversify your client base.
Q: Can I hedge synthetic trades with real-world instruments?
A: No direct correlation exists between synthetics and real-world markets. These instruments are built for technical strategies and price pattern trading, not macro hedging.