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Summary
- LSE, established in 1571, is one of the largest and oldest Stock Exchange in the world
- The FTSE originated as a joint venture of Financial Times and London Stock Exchange
London Stock Exchange (LSE) was established in 1571 and is one of the largest and oldest Stock Exchange in the world. It is based in London, UK and is owned by the London Stock Exchange Group. Its Market Capitalisation stood at around 3.88 trillion British Pounds at present and it comprises stocks from over 40 different sectors, which are benchmarked through the FTSE UK Index Series that has evolved through time and changing market needs and scenarios.
What is FTSE?
FTSE stands for Financial Times and Stock Exchange and also known as FTSE Russell Group (or Footsie), which is wholly owned by the London Stock Exchange Group (LSEG) that specialises in providing true picture of various listed securities by developing a comprehensive range of reliable and accurate Indexes for financial products that track the performance of a group of financial securities and carry out research and analysis for better understanding, decision making and meeting clients’ needs across asset classes, style and strategies.
FTSE Russell’s range of indexes combines the specialist knowledge gained from developing local benchmarks across the world and also provides clients with a range of tools for asset allocation, investment strategy analysis and monitoring and managing risk/volatility. The FTSE originated as a joint venture of Financial Times and London Stock Exchange and hence FTSE was named by taking the first two words of both the group (FT and SE that make FTSE). FTSE Russell follows high industry standards and embraces the IOSCO Principles to focus on index innovation and customer partnership. It includes various indexes of which three major Stock Indexes are FTSE 100, FTSE 250 and FTSE 350.
FTSE 100
FTSE 100 Index consists of 100 largest blue-chip companies listed on London Stock Exchange by Market Capitalisation. It was launched on 3rd January 1984, and since then, it is acting as a barometer of market activities and represents more than 80% of the London Stock Exchange’s market capitalisation. FTSE 100 uses the total market capitalization of its constituents, which changes with the change in the market price of the company, subsequently leading to change in index value and when the price moves up and down the change is quoted against the previous day closing prices. It also reflects the economic and international events, and the index are reviewed to ensure that the companies with the highest market capitalisations are included.
FTSE 250
FTSE 250 Index consists of 250 largest companies after those who are the constituents of FTSE 100, it includes 101st to the 350th largest companies, which represent mid cap stocks that are traded on the London Stock Exchange. It was launched in 1992 and has the ability to mirror dynamic segments of the UK equity market. FTSE 250 is a capitalisation-weighted index that includes companies according to its market capitalisation as similar to FTSE 100 Index.
FTSE 350
FTSE 350 is a market capitalisation weighted stock market index that represents large and mid-cap stocks traded on the London Stock Exchange and is made up of the constituents of the FTSE 100 and FTSE 250 Index. It brings together the largest 350 companies traded on London Stock Exchange.
The other FTSE group stock market indices, include FTSE All-Share index, FTSE SmallCap Index, FTSE 4Good Index, FTSE AIM UK 50 Index, FTSE AIM 100 Index, FTSE AIM ALL-Share Index, FTSE MIB, Russell Indexes, Russell 3000 Index, Russell 2500 Index, Russell 2000 Index, Russell 1000 Index, Russell top 200 Index, Russell Top 50 Index, Russell Midcap Index, Russell Microcap Index and Russell Small Cap Completeness Index.
