How to trade the German election 2021

On September 26 2021, Germany will go to the polls to elect its next federal parliament. Learn how to trade the next German election with our huge range of markets.


When is Germany's next election?

Germany’s next election is on September 26 2021, as determined by the current Federal President. The results of the vote will elect a new federal parliament – the Bundestag – including a new Chancellor. Alongside this vote are several local and state elections.

A Bundestag election – to designate the next representative of the Federal Republic of Germany – are held between 46 to 48 months after the previous electoral term started. In this case, the term started on October 24 2017.

Who are the German Chancellor candidates?

The main parties in the running are current Chancellor Angela Merkel’s party the Christian Democrats (CDU) the Greens and the Social Democrats.

After 16 years in office, Merkel is stepping down, which has created uncertainty over who could get into power next. The current candidates for Chancellor are:

  • Armin Laschet, the Christian Democrats
  • Annalena Baerbock, the Greens
  • Olaf Scholz, the Social Democrats

According to recent polls, Baerbock is the current favourite. She’s stated that while she’s never been Chancellor or even a minister, she’s committed to giving the country a fresh start. Since it was announced Baerbock would be running, the comparisons between her and Merkel have been rife.

However, Laschet has also been compared to his CDU predecessor due to their similar moderate and centrist views. While Laschet is promising change, in many ways he represents continuity for the country. Something that, from judging the polls, isn’t overly popular.

Due to the German voting system, it is likely that two of the candidates could end up governing together. Coalition governments are extremely common in the Bundestag. It is possible that The Greens and Social Democrats could form a government to oust the CDU.

How could each German political party affect market sentiment?

Each parties’ policies will influence the sectors and companies that are likely to benefit from their time in office, as well as the economic policies that will shape the country for the next few years.

The Greens – current favourites – were originally a radically left party but have gradually become more mainstream. They remain focused on climate change, and are a pro-European, refugee-friendly party. If the Greens win the German election, the policies are likely to provide a boost to companies focused on renewable energy and electric vehicles, as well as companies that can aid in the digitalisation of Germany.

The CDU is historically the party that has occupied the Chancellor’s office the most – for 57 out of 72 years. Although typically a conservative party, under Merkel it has moved increasingly to the political centre. Laschet is known to have a softer line on Russia and China than the Greens, which could promote growth among German export industries. He’s also a lot more reserved on climate change – believing protection should not inhibit German production.

Steps to trading the German election

You can trade assets that will be moved by the German elections with City Index – including forex, shares and indices. Follow these easy steps to start trading:

  1. Open a City Index account, or log in if you’re already a customer
  2. Search for the asset you want to trade in our award-winning platform
  3. Choose your position and size, and your stop and limit levels
  4. Place the trade and monitor the market

Markets to watch

The markets to watch going forward are the Euro, German stocks and indices – including the DAX.

Here are some of the financial markets that are likely see volatility in the run up to and after the result of the German election.


Major forex pairs involving the Euro could see volatility in the lead up to and aftermath of the election. These include:


Learn more about trading forex or open an account to get started.


Depending on which party gets into power, certain groups of stocks are likely to benefit. For example, the Greens would boost sustainability stocks, while the CDU would focus on German manufacturing and exports. This could include the likes of Encavis and RWE for renewable energy, and Volkswagen Group, Daimler and Bosch.

Learn more about trading shares or open an account to get started.


Germany’s leading stock index, the DAX, will likely bear the brunt of any election volatility. Other Deutsche Borse indices could also see movements, such as the MDAX, TecDAX and SDAX.

Learn more about indices trading or open an account to get started.

How does Germany elect their chancellor?

When German citizens vote, they will not be voting directly for their Chancellor. Instead, the top candidate from the party that wins the most votes will be presented as the Chancellor by the Federal president. The newly elected parliament then confirms the Chancellor by ballot.

Germany has a notoriously complicated system for electing the Bundestag. It combines elements of both direct and proportional representation.

There are 598 seats in the Bundestag, and the seats are split 50:50 between two systems of voting.

  1. The Erststimme or first vote: a first-past-the-post system in which the district representative is elected as an individual candidate. Voters choose their favourite, and every candidate who is elected will win a seat
  2. The Zweitstimme or second vote: using a proportional representation system, voters choose a political party to instead of a single candidate. The party with the largest vote gets the most seats and larger percentage of the overall Bundestag

The system allows votes to be split amongst parties. People can vote for one in the individual elections and a different party entirely in the second vote.

In order for a party to enter parliament, it must win a minimum of 5% of the votes. This has served to keep extremist groups out of parliament.

Build your confidence risk free

More from Election

Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.