The London Stock Exchange FTSE IndexOn the London Stock Exchange FTSE Group calculates over 60,000 indices covering 48 countries and all major asset classes, but of course, they are most famous for their London Stock Exchange FTSE Index of the biggerst 100 companies. Every listed share receives a weighting in the index and this weighting relates to a number of factors. In general, market cap is the main factor. This means that firms such as Vodafone and BP make up very large parts of the movement of the top 100 index and the FTSE All Share. In fact, depending on current values (which are obviously always moving) the shares of the FTSE 100 index usually make up over 80% of the total value of the listed shares on the London Stock Exchange! In other words, as interesting as it may be to watch the 250 index or concentrate on the FTSE Fledgling, all the action is in the top 100 companies. If you would like to see how the London Stock Exchange FTSE Index is performing and what shares are currently in the prestigious 100 list, just click on this link to go to the Bloomberg market movers page. All index constituents are free float adjusted in accordance with the London stock exchange FTSE index rules, to reflect the actual availability of stock in the market for public investment.
How heavy is heavy The first index was the FT 30 which began at a starting point of 100 in 1935. It is also known as the FT Ordianry Share Index. It contains 30 of the UK's largest quoted companies and is calculated as a geometric mean. The FT 30 is mainly made up of industrial firms which means that it isn't very representative of the UK economy or stock market. The top 100 companies actually lean very heavily towards just a few key sectors of the UK economy. Anyone that knows the UK will realise that these include oil (BP and Shell are both members), finance (HSBC, Barclays, Lloyds and others) and utilities (Centrica, the providers of water, gas and electricity) are some of the mainstays. In fact, the FTSE 100, "The City" and the south east of England are all quite reliant on the impact that finance has on the UK economy. Some estimates put the total number of people employed by banks and in finance in London at over 250,000 in 2011. While this may not necessarily sound like a large number for such a large city, many of these people have significant earning potential and have an impact on property prices and many other areas of society. This means that the UK economy is very heavily dependent upon financial services. Therefore, when something good or bad happens to financial markets, London is usually impacted in some way or other. FTSE also offer a range of other indices to give global values and many other things. For example: All-World Index Series, Global Equity Index Series, Global Islamic Index Series, Global Sector Index Series, Global Small Cap Index Series, Global Style Index Series, Gold Mines Index Series, Multinationals Index Series, Watch List Index Series Global Bond Index Series, UK Gilts Index Series Do you want to improve your trading skills? Click here to watch a free online
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