The United Kingdom is among the world’s largest national economies. With the highest Gross Domestic Product (GDP) in Europe and the third largest stock exchange in the world, the UK financial market is filled with extraordinary opportunities for international investors. Many large companies operate within its economy and to succeed as an investor, it is essential to know how to track their performance. Below you will find three efficient tools that will help you get off on the right foot and get the best out of the UK financial market.
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The Financial Times Stock Exchange 100 Index
The Financial Times Stock Exchange 100 Index, commonly known as the FTSE 100 Index, FTSE 100, or the “Footsie” – is a stock market index composed of the top 100 companies listed on the London Stock Exchange that have the highest market capitalization. This index represents about 81% of the entire market cap of the London Stock Exchange and encompasses companies that expand over several industries, including mining, pharmaceuticals & biotechnology, support services, and life insurance. As of March 2019, the top 5 constituents were 3i (III), Admiral Group (ADM), Anglo American plc (AAL), Antofagasta (ANTO), and Ashtead Group (AHT).
Why is the FTSE 100 Index a great tool for monitoring trading assets in UK? It is a measurement of the overall stock market in the UK; it shows how various market segments are performing and enables investors to evaluate the listed stocks and invest in the ones that meet their needs. The index was established on January 3, 1984 at the base level of 1000 points and it reached the highest closing value of 7,877.4; and the highest intra-day value of 7,903.50 on May 22, 2018. This indicates that UK’s top 100 companies have grown by more or less 600% over time. Keep in mind that the constituents change according to their market cap!
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The Financial Times Stock Exchange 250 Index
The FTSE 250 Index consists of the 101st to the 350th largest companies listed on the London Stock Exchange. Its components are weighted according to the total market value of their outstanding shares. Unlike the Footsie, the FTSE 250 Index can be used to gauge the health of the UK economy in particular, due to the fact that only a small portion of the listed companies perform international-focused operations and a lot of companies are investment trusts. The top 5 constituents after the last change (April 15, 2019) are: 3i Infrastructure (3IN), 888 Holdings (888), Aberforth Smaller Companies Trust (ASL), Acacia Mining (ACA), and Aggreko (AGK).
Conclusion
The United Kingdom houses the world’s largest financial center alongside New York and the London Stock Exchange contains over 2500 companies (as of April 2018), from over 60 countries. This year is expected to be a very exciting one for the British financial market, as the Brexit proceedings have been delayed. If you’ve been planning to join the UK stock market, this is the right moment! Make sure to use the right tools, pick a reliable broker and always stay informed – the profits will come in no time.