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Best FTSE 100 Index Trading Brokers

FTSE 100 is a stock index that is widely used throughout Europe. The constituents of the Footsie or UK 100 as it is also called are the 100 companies listed on the London Stock Exchange that have the largest market capitalization. The majority of them are multinational entities headquartered in the UK which means the index is not that indicative of the health of the country’s economy, but rather shows what business environment the British company law provides.

The performance of the 100 companies is closely tracked through reviews and eventual substitutions are made every quarter – in March, June, September, and December. We can safely say that any changes made reflect the current state of the companies since value information is derived at the end of the day preceding each review.

How FTSE 100 Trading Works for Traders and Brokers

FTSE 100 TradingTraders who operate with the FTSE 100 must keep one specific aspect in mind. The current UK 100 index value is highly dependable on the British pound currency rates. As most companies in the UK 100 have their income in foreign currencies, the movement of the sterling is capable of causing a downward or upward price movement.

The high interest in trading the FTSE 100 and other popular indices is mainly due to the fact they are considered secure and come with relatively low fees and commissions imposed by the trading brokers. The main reason for indices not to carry as much risk as stocks for example is their broad nature. A large number of stocks in multiple industries are covered which means devastating collapses are hardly possible. Even if a few companies suffer hard times and their stock price gets low, there is a chance for the other index constituents to mitigate the adverse effect.

The most commonly used derivative instrument offered by FTSE 100 trading brokers is CFD (contract for difference). It enables exchanging the difference between the opening and closing price of the traded index. Buying a CFD opens a long position while by selling, traders go short. The other methods to operate with the UK 100 index are:

  1. Futures
  2. Spread betting
  3. Options
  4. Exchange-traded funds (ETFs)

As regards FTSE 100 trading hours, they are from Monday till Friday between 8am and 4pm UK time, which is in line with the London Stock Exchange opening and closing hours. However, lots of online trading brokers allow for 24/5 trading with customer support within the same hours.

Top FTSE 100 Trading Brokers

choosing a brokerTechnology advancements in recent years have led to growth in many areas, including trading. As a result, the market is flooded with online brokers and finding one that fits your needs is not always an easy task. And here we are not talking about whether a brokerage is good at its job, but whether it tallies your trading style. To help you get through this process more easily, we prepared a selection of ten trustworthy UK 100 trading brokers, summarizing the information about the respective leverage, spreads, fees, commissions, and other important features.

Related Topics


1. What does the FTSE 100 stand for?

UK 100, FTSE 100, or Footsie are all equivalents to the Financial Times-Stock Exchange 100 Share Index. It is owned by the London Stock Exchange Group.

2. FTSE 100 is a market-weighted index. What does this mean?

The index price movement is most strongly affected by the largest companies in the group, not necessarily the ones with the highest single share price. That is why it is very important to study carefully the FTSE 100 constituents and their influence.

3. What is the average FTSE 100 annual return?

When trying to get an idea of what return to expect from trading the FTSE 100 index, it is better to cast an eye on a longer time frame, not just one year, for example. As per data published by IG (reviewed above) the annualized price return for the period 1984 - 2019 is 5.77% while the annualized total return is 7.75%.

4. Should I trade FTSE 100 or FTSE 250?

This question does not have an unambiguous answer as it really depends on what you are looking for. The FTSE 100 is often considered the preferred index since it comprises stocks of the companies with the highest market cap. However, one should not underestimate the fact that the FTSE 250 index accommodates a greater number of stocks, covers a more diverse set of industrial sectors, and has performed slightly better back through the years.

5. What are the FTSE 100 inclusion criteria?

The FTSE UK Index Series includes securities with a minimum free float of 10% if the respective company is incorporated in the UK. In case the entity is headquartered outside the United Kingdom, the requirement is for a free float of at least 25%. Exceptions to these rates are allowed for start-ups that are expected to be able to meet the requirement within 12 months of the date of their first trading.