Trading FTSE 100

What is FTSE 100?

The FTSE 100 tracks the 100 largest companies listed on the London Stock Exchange by market capitalisation. With heavy weighting towards mining, energy, and financials, it's often considered a global barometer rather than purely domestic.

Trading Hours: Near 24/5 (underlying: 08:00-16:30 GMT)

Key Price Drivers

Understanding what moves FTSE 100 is essential for developing effective trading strategies:

• GBP strength (inverse correlation — most revenue is overseas)
• Commodity prices (mining/energy heavy weighting)
• Bank of England policy
• Global economic outlook

Who Should Trade FTSE 100?

How to Trade FTSE 100 with a Broker

Most retail traders access FTSE 100 through CFDs (Contracts for Difference), which let you speculate on price movements without owning the underlying asset. Here's what to look for:

1. Tight Spreads: Lower spreads reduce your trading costs on every position
2. Fast Execution: Critical for short-term strategies and volatile instruments
3. Risk Management Tools: Stop-loss orders, guaranteed stops, and negative balance protection
4. Platform Quality: Advanced charting, technical indicators, and mobile trading
5. Regulation: Always choose a broker regulated by a Tier-1 authority

Trading Strategies

Day Trading

Day trading FTSE 100 involves opening and closing positions within the same trading day, capitalising on short-term price movements. Requires fast execution, tight spreads, and understanding of intraday patterns.

Swing Trading

Swing traders hold positions for days to weeks, capturing medium-term trends. This approach requires less screen time and can suit traders with other commitments.

Position Trading

Position traders take longer-term views, holding for weeks to months based on fundamental analysis and major trend identification.