Understanding the UK 100 (FTSE 100)

UK 100

The UK 100 – also known as the FTSE 100, FTSE, Footsie, or more formally the Financial Times Stock Exchange 100 Index – is a market-cap weighted that tracks the share prices of the largest companies listed on the London Stock Exchange (LSE). Launched in the mid-1980s, it replaced the FT30 as the primary benchmark for UK company performance.

While the FTSE 100 includes the LSE's largest listed firms by market cap, these are primarily internationally-focused companies generating most of their revenue overseas. Hence, the UK 100 has developed a reputation for being a poor barometer of how the UK economy may be performing, while having also gained a close inverse correlation with the value of the GBP, since overseas revenues repatriated to GBP increase in value as the currency declines.

Stock market trading for the cash index occurs between 8:00 AM and 4:30 PM London time on all UK working days, with the close of trade followed by an auction, after which, at 4:35pm, the index’s closing value is published. Out of cash hours, the index trades via futures contracts, as well as both (Contracts for Difference) CFDs and spread bets derived from the aforementioned contract.

Stock indices like the FTSE 100 offer valuable insights into market movements. As the below shows, the UK 100 has significantly underperformed global peers of late, with the index’s value-heavy nature causing it to largely miss out on the AI- and tech-driven rally that has driven global equities substantially higher in recent years. As always, past performance is no reliable indicator of future results.

At the time of writing, the weightings of individual UK 100 constituents are as follows: