A brief overview of the range of indices that FTSE International (FTSE) have created to measure the equity markets in the UK.
FT Ordinary Share Index (FT30)
The FT30 Index was first calculated in 1935 by the Financial Times newspaper. The Index started at a base level of 100, and was calculated from a subjective collection of 30 major companies – which in the early years were concentrated in the industrial and retailing sectors.
For a long time the Index was the best known performance measure of the UK stock market. But the index become less representative of the whole market. Also the index was price-weighted (like the DJIA), and not market-capitalisation-weighted. Although the index was calculated every hour, the increasing sophistication of the market needed an index calculated every minute and so the FT30 has been usurped by the FTSE 100.
Articles on the FT30 Index.
Today, the FTSE 100 Index (sometimes called the “footsie”) is the best known index tracking the performance of the UK market. The index comprises 100 of the top capitalised stocks listed on the LSE, and represents approximately 80% of the total market (by capitalisation). It is market capitalisation weighted and the composition of the index is reviewed every three months. The FTSE 100 is commonly used as the basis for investment funds and derivatives. The index was first calculated on 3 January 1984 with a base value of 1000.
The FTSE 100 Index, and all the FTSE indices, are calculated by FTSE International – which started life as a joint venture between the Financial Times newspaper and the London Stock Exchange, but is now wholly owned by the LSE.
Articles on the FTSE 100 Index.
Similar in construction to the FTSE100, except this index comprises the next 250 highest capitalised stocks listed on the LSE after the top 100. The index is sometimes referred to as the index of “mid-cap” stocks, and comprises approximately 18% of the total market capitalisation.
Articles on the FTSE 250 Index.
The FTSE 350 is simply an index comprising all the stocks in the FTSE 100 and FTSE 250 indices.
Articles on FTSE 350 Index.
FTSE Small Cap
Comprised of companies with a market capitalisation below the FTSE 250, but above a fixed limit. This lower limit is periodically reviewed. Consequently the FTSE Small Cap Index does not have a fixed number of constituents. In mid-2012, there were 248 companies in the index, which represented about 2% of the total market by capitalisation.
Articles on FTSE Small Cap Index.
The FTSE All-Share is the aggregation of the FTSE 100, FTSE 250 and FTSE Small Cap indices. Effectively all those LSE listed companies with a market capitalisation above the lower limit for inclusion in the FTSE Small Cap Index. The FTSE All-Share Index is the standard benchmark for measuring the performance of the broad UK market and represents 98-99% of the UK market capitalisation.
Articles on the FTSE All Share Index.
This index comprises the companies that do not meet the minimum size requirement of the FTSE Small Cap Index and are therefore outside of the FTSE All-Share Index. In mid-2012 there were 112 companies in the FTSE Fledgling Index.
Articles on FTSE Fledgling Index.
FTSE All-Small Index
This consists of all the companies in the FTSE Small Cap and FTSE Fledgling indices.
Reflects the performance of companies in the Technology, Media and Telecommunications sectors.
FTSE techMARK All-Share
An index of all companies included in the LSE’s techMARK sector.
FTSE techMARK 100
The top 100 companies of the FTSE techMARK All-Share, under £4bn by full market capitalisation.
FTSE AIM UK 50 Index
Comprises the 50 largest UK companies quoted on the Alternative Investment Market (AIM).
FTSE AIM 100 Index
Comprises the 100 largest companies quoted on the Alternative Investment Market (AIM).
FTSE AIM All-Share Index
All AIM-quoted companies.