Investing in FTSE 100 Shares in the UK

For British investors taking their first steps into the stock market, the FTSE 100 offers a grounded starting point. It reflects the performance of the 100 largest companies listed on the London Stock Exchange, including well-known names like Tesco, Lloyds, and BP. These are not high-risk growth stocks but established firms with significant market value.

Beyond name recognition, FTSE 100 shares offer access to stable earnings, regular dividends, and international business exposure. These are all within the framework of UK regulation. Understanding how to enter this space, from selecting a broker to navigating market risks, is essential for building a confident investing strategy.

Brokers to Invest in the FTSE 100 Shares

Choosing an index broker that matches your goals is one of the first practical steps in investing in FTSE 100 shares. Here are three widely used brokers that offer access to FTSE 100 shares for UK-based investors.

1. eToro

eToro has become a popular choice for beginners thanks to its clean interface and zero-commission share trading. It supports a wide range of global and UK-listed stocks, including those in the FTSE 100. A key feature is its social trading function, which lets users view and copy other investors’ strategies. However, withdrawal and inactivity fees can apply if you trade infrequently.

2. IG Markets

Founded in the UK, IG Markets offers a comprehensive platform for those who want more than basic investing tools. It provides access to the full FTSE 100, along with thousands of international shares. While IG charges a commission on trades, it also offers advanced charting, research, and risk management features. It’s better suited to active investors or those exploring spread betting and CFDs.

3. Pepperstone

Pepperstone is primarily known for forex and CFD trading. It lets users trade FTSE 100 shares via contracts for difference, meaning you speculate on price moves without owning the shares directly. This approach appeals to short-term traders, but leverage and volatility increase risk, improving it for experienced investors with a defined strategy.

How to Choose the Right Broker for Investing in the FTSE 100 UK

The right broker depends on how you plan to invest. Some platforms are better for long-term strategies, while others suit short-term or more active trading.

If you want to buy and hold shares, eToro or IG Markets’ share dealing account offers simple access to FTSE 100 stocks. If you’re more interested in short-term trading, IG’s advanced tools or Pepperstone’s CFD platform may suit you better. For beginners, eToro’s clear layout and social features are often a good starting point.

Here’s what to look for when comparing brokers:

Choosing a reliable, well-regulated platform with fair costs and the right features makes a real difference. Not just at the start, but throughout your investing journey.

FTSE 100 Share Price Today

The FTSE 100 index moves throughout each trading day, tracking the performance of the 100 largest companies listed on the London Stock Exchange. When people refer to the FTSE 100 share price, they usually mean the index value, not a single stock.

This index is weighted by market size, so larger firms have a greater impact on its direction. A 0.5% rise means the biggest UK-listed companies have gained overall, though individual shares may tell a different story.

For example, if BP shares jump due to oil prices, it can lift the index even if others fall. That’s why it’s worth looking beyond headlines.

Most index brokers and financial sites provide live data. Below, our interactive chart shows the FTSE 100 share price today, along with past trends and stock-level shifts. It’s a practical tool for spotting movements and making more informed decisions.

Why Invest in FTSE 100 Shares?

FTSE 100 shares offer UK investors a clear and accessible route into the stock market. The index includes some of the most established companies on the London Stock Exchange, making it a practical option for those starting out.

Global Exposure from Home

Several FTSE 100 companies, including Shell, HSBC, and Unilever, operate on a global scale. Buying their shares gives you indirect access to international markets, all through a UK-based investment platform.

Consistent Dividend Income

A large portion of FTSE 100 companies pay regular dividends. For investors focused on income, this can provide a steady return alongside potential growth.

Well-Known Names

Familiar brands like Barclays or Marks & Spencer can be easier to understand and follow. This helps newer investors make more informed choices based on products and businesses they already know.

Clear Regulation and Reporting

These companies are closely watched by regulators and analysts. That means reliable data, regular updates, and fewer surprises, which is useful for building trust in your investments.

ISA-Friendly Investing

When bought through a Stocks and Shares ISA, FTSE 100 shares can grow without triggering capital gains or income tax. This makes them a tax-efficient tool for long-term planning.

Risks to Be Aware Of

FTSE 100 shares are often seen as more stable than smaller stocks, but they’re not risk-free. Understanding potential downsides can help you invest with greater clarity and control.

Market Volatility

Even the largest companies face ups and downs. Share prices can fall due to political changes, economic shocks, or disappointing earnings. Sharp moves aren’t limited to smaller firms, as big names can also underperform.

Sector Imbalance

The FTSE 100 is dominated by companies in sectors such as banking, energy, and consumer staples. If these industries experience a downturn, the overall index can be affected. Diversifying beyond the FTSE 100 can help reduce this concentrated risk.

Uncertain Dividends

While many FTSE 100 stocks pay dividends, these payments aren’t guaranteed. Companies may cut or pause dividend payments if earnings decline could affect investors relying on regular income.

Currency Risk

Many FTSE 100 companies earn in dollars or euros. If the pound strengthens, foreign revenues may convert to fewer pounds, lowering reported profits. If the pound weakens, earnings may appear higher, but it’s not always a true gain.

Interest Rate Pressure

When the Bank of England raises interest rates, some investors shift to safer assets like bonds. This can lead to reduced demand for shares, particularly in slower-growth sectors.

Keeping track of market developments and reviewing your portfolio regularly can help reduce the impact of these risks.

FAQs

Conclusion

FTSE 100 shares give UK investors access to stable, well-known companies with strong global reach. Choosing a suitable broker, staying aware of market shifts, and weighing both opportunity and risk are key steps in building a solid foundation.

Success rarely comes from perfect timing. It comes from steady, well-informed decisions made over time. For many new investors, the FTSE 100 is a logical and accessible place to start that process.