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INVESTOR EDUCATION
FTSE 100 Index


 

The FTSE 100 Index is a share index of the 100 most highly capitalised companies listed on the London Stock Exchange. The index began on 3 January 1984 with a base level of 1000; the highest value reached to date is 6950.6, on 30 December 1999.

FTSE is an abbreviation of 'Financial Times Stock Exchange'. The index is maintained by the FTSE Group, a now independent company which originated as a joint venture between the Financial Times and the London Stock Exchange.

FTSE 100 companies represent about 80% of the market capitalisation of the whole London Stock Exchange. Even though the FTSE All-Share Index is more comprehensive, the FTSE 100 is by far the most widely used UK stock market indicator. Other related indices are the FTSE 250 Index (which lists the next largest 250 companies after the FTSE 100), the FTSE 350 Index (which is the aggregation of the FTSE 100 and 250), FTSE SmallCap Index and FTSE Fledgling. The FTSE All-Share aggregates the FTSE 100, FTSE 250 and FTSE SmallCap.

The constituents of the index are determined quarterly; the largest companies in the FTSE 250 Index are promoted if their market capitalisation would place them in the top 90 firms of the FTSE 100 Index. As of 2006, the threshold for inclusion is about £2.9 billion. As of 29 December 2006 the 6 largest constituents of the index were BP, Royal Dutch Shell, HSBC Holdings, the Vodafone Group, the Royal Bank of Scotland Group and GlaxoSmithKline, which were each valued at more than £60 billion.

Component companies must meet a number of requirements set out by the FTSE Group, including having a full listing on the London Stock Exchange with a Sterling or Euro dominated price on SETS, and meeting certain tests on nationality, free float, and liquidity.

Most of the companies listed on this index usually include the abbreviation plc at the end of their name, indicating their status of public limited company.

Trading lasts from 08.00-16.29 (when the closing auction starts), and closing values are taken at 16.35

List of FTSE 100 companies: See --->http://en.wikipedia.org/wiki/FTSE_100_Index

This reflects the replacement of Kelda Group with Alliance Trust on 7 February 2008.

The 33 FTSE 100 companies which had a market capitalisation of £10 billion or more on 31 December 2007, the last trading day of 2007 Source: from this page on the London Stock Exchange's official site. Companies which do not have their primary listing on the London Stock Exchange are not eligible for membership of the FTSE 100 Index and have been excluded.

FT 30

The oldest continuous index in the UK is the now largely redundant FT30 which began on July 1st 1935. Of the original constituents, two are currently in the FTSE 100: Imperial Tobacco and Rolls Royce, although Rolls Royce has not been continuously listed. ICI was removed when it was taken over by Akzo Nobel in January 2008. A further five are still listed but not in the FTSE 100: EMI, The General Electric Company (now Telent), Guest Keen & Nettlefolds (GKN), Tate & Lyle and Woolworths, although Woolworths has also not been continuously listed. Three of the original FT30 companies are still in that index remain in the FT30: EMI, GKN, and Tate & Lyle (membership is not strictly based on market capitalisation, so this does not mean they are necessarily among the top 30 companies in the FTSE 100). The best performer from the original line-up has been Imperial Tobacco.[7]

References

  1. Rio Tinto Group is a dual listed company. The figure shown represents only the majority stake owned by Rio Tinto Plc.
  2. BHP Billiton is a dual listed company. The figure represents only the minority stake owned by BHP Billiton Plc.
  3. Unilever is a dual listed company. The figure represents only the minority stake owned by Unilever Plc.
  4. Acquisition by Lloyds
  5. Acquisition by Deutsche Bank
  6. Unification of companies
  7. Eckett, Stephen (ed.) (2004), The UK Stock Market Almanac 2005, Petersfield, Harriman House

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