DAX

Germany's blue-chip benchmark

The DAX — short for Deutscher Aktienindex — has been the flagship index of the Frankfurt Stock Exchange since 1 July 1988 and is regarded as the most important barometer of the German economy. It is calculated and maintained by Deutsche Börse AG through its index subsidiary STOXX Ltd. Since the landmark reform of 20 September 2021 the index covers 40 companies instead of the previous 30 — a response to the Wirecard scandal of 2020 and the demand for broader representation of the German economy.

Methodologically the DAX is a total return index: dividends are treated as reinvested, which makes it look optically much higher than pure price indices such as the S&P 500. Weights are based on free-float market capitalisation, with a 10% cap per single name — introduced after SAP's dominance in the late 2000s.

Inclusion criteria after the reform

Since September 2021 the index commission has applied stricter quality standards:

• Profitability: two consecutive years of positive EBITDA before a company can be admitted.
• Reporting: audited annual reports and quarterly statements published within the statutory deadlines.
• Audit committee: a dedicated audit committee on the supervisory board is mandatory.
• Market capitalisation: minimum rank 40 by free-float over the relevant trading-day window.

The complementary indices MDAX (50 mid caps), SDAX (70 smaller companies) and TecDAX (30 technology-heavy names) cover the rest of the German equity market.

What sits in the index

As of mid-2026 SAP, Siemens, Allianz, Deutsche Telekom and Airbus dominate by weight — together they make up around 35% of the index. Striking is the heavy concentration in industrials, pharma (Bayer, Merck KGaA), banks (Deutsche Bank, Commerzbank) and insurers. Pure tech names are under-represented — a structural feature of the German economy compared with the US-tilted MSCI World.

Historical annual returns since 1988 sit at roughly 8% per year including reinvested dividends — broadly in line with international equity averages, though with higher volatility during crises.

Investability

Retail investors usually access the DAX via ETFs such as the iShares Core DAX UCITS ETF (ISIN DE0005933931, TER 0.16%) or the Xtrackers DAX UCITS ETF (ISIN LU0274211480). Both replicate physically and come in accumulating or distributing variants. In Austria, KESt of 27.5% applies to both capital gains and dividends.

What investors often ask

Why is the DAX so much higher than the Dow Jones? Because the DAX is a total return index that reinvests dividends, while the Dow Jones is a pure price index. A direct level comparison is methodologically misleading.