What powers the price of a synthetic index?

A cryptographically secure random number generator, shaped by a pre-set volatility profile unique to each instrument.

Is there an order book behind synthetic index prices?

No. There's no order book and no real buyers or sellers; the price comes entirely from the pricing engine.

How often does the price update?

Roughly twice a second, through a continuous price feed.

What is a tick on a synthetic index?

The smallest price movement the pricing engine can produce. Every price update is one tick, and tick size is set by the instrument's volatility profile rather than by market supply and demand.

What does the number in a Boom or Crash index name mean?

It's the average number of ticks between upward spikes (Boom) or downward spikes (Crash). A lower number means those moves happen more often.

What does the number in a Volatility or Jump index name mean?

It's the instrument's target annual volatility, so a higher number means larger typical price swings.

Can economic news move a synthetic index's price?

No. Synthetic indices have no underlying asset, so earnings, interest rate decisions and geopolitical events don't factor into the price.

Do synthetic indices pay dividends?

No. There are no corporate actions or dividend adjustments on synthetic indices, unlike some real market indices.

How Are Synthetic Indices Priced? The Algorithm Explained

Academy Synthetic Indices How Are Synthetic Indices Priced? The Algorithm Explained