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Investing in the FTSE 100

The Financial Times Stock Exchange 100 (FTSE 100) is the UK’s most popular index containing the top 100 publicly-owned companies listed on the London Stock Exchange. The index offers traders and investors plenty of opportunities, including an option to trade individual company stocks tracked by the index or trade the index as ETFs. In addition, you can trade the index as a derivative product and profit from the underlying asset’s price difference.

In this guide, we explore how to invest in the FTSE 100 using online brokers. Before you start investing in the asset, we advise you to review its current news to understand what drives FTSE 100 daily movement. This way, it will be easier for you to strategise and maximise your potential of making profits. 

Top 3 brokers for Investing in the FTSE 100

Many traders and investors choose to invest in the FTSE 100 long-term because indices are known to be more stable compared to other highly volatile assets. However, other traders will prefer taking short positions such as day trading by quickly opening and closing multiple positions within a day to benefit from small price fluctuations. 

Whether you choose to trade or invest in the FTSE 100, you need a reliable broker to give you all the support to trade or invest successfully. Finding such brokers can be daunting, and for this reason, we sifted through the dozens of options out there to recommend the top three brokers for investing in the FTSE 100 in the UK.

1. eToro

Etoro index page
Etoro screen
Etoro
Etoro mobile
Etoro broker
Etoro index page
Etoro screen
Etoro
Etoro mobile
Etoro broker

eToro has a user-friendly platform and offers investors and traders opportunities to trade the FTSE 100 index as CFD and ETF. ETFs are investment funds tailored to track the performance of indices on a stock market. Additionally, you can diversify your portfolio with other major indices and assets offered, including stocks, forex, commodities, cryptocurrencies, etc. 

eToro supports its clients with all the necessary trading tools to maximise their experience. This includes an award-winning social and copy trading platform to help in advancing their skills and increasing their potential for profits, respectively. In addition, research tools are plenty for technical and fundamental analysis. All you need to do is confirm whether eToro fits your trading requirements to enjoy these features and more. 

Even though the broker requires a minimum deposit of £50 to trade the FTSE 100 index, trading charges are high. The copy trading platform can also limit low-budget traders due to its high minimum deposit and minimum amount per trade.

TradingGuides Rating:
✔Copy/Social trading
✔Low minimum to fund an account and begin investing
2.8 rating
2.8
Risk Warning
Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you can afford to take the high risk of losing your money.

2. IG Markets

IG Markets official site
IG Markets desktop
IG Markets broker
IG Markets mobile
IG Markets
IG Markets official site
IG Markets desktop
IG Markets broker
IG Markets mobile
IG Markets

IG Markets allow you to trade the FTSE 100 index as CFDs and index futures, whereby you agree to trade the FTSE 100 index at a specific price on a particular day in the future. The broker also hosts quality resources that, when used strategically, can increase your chances of succeeding. Moreover, there is an IG Community platform that newbies can take advantage of to network and learn from other traders.

Unfortunately, trading FTSE 100 at IG Markets attracts high trading fees. Its minimum deposit requirement is £300, which in our opinion, is high for low-budget traders and investors. Additionally, the broker charges subscription fees for traders who do not open a position at least three times within three months. Its customer service also operates five days a week

TradingGuides Rating:
✔ Extensive range of offerings
✔ Leading broker with low fees
3.1 rating
3.1
Risk Warning
Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you can afford to take the high risk of losing your money.

3. Pepperstone

Pepperstone index page
Pepperstone
Pepperstone screen
Pepperstone mobile
Pepperstone broker
Pepperstone index page
Pepperstone
Pepperstone screen
Pepperstone mobile
Pepperstone broker

At Pepperstone, the FTSE index is traded as CFDs on a platform known to execute trades fast. There are no commissions but spreads, which are among the lowest in the industry. In addition, Pepperstone is a social trading broker allowing you to learn from other traders and improve your skills. The broker also features copy trading, whereby you get to copy advanced traders’ positions and make profits when they do. 

Note that Pepperstone has advanced platforms, including the MT4/MT5 and the cTrader. Therefore, feel free to choose the perfect one for your skills level and enjoy advanced trading tools. Sadly, you will have to deposit a minimum of £200 to trade the FTSE with Pepperstone. On top of that, you can only trade FTSE 100 as CFDs. 

TradingGuides Rating:
✔ Top tier liquidity
✔ No dealing desk intervention
3.3 rating
3.3
Risk Warning
Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you can afford to take the high risk of losing your money.

How to Buy FTSE Shares With eToro

Before kickstarting your activities, you need to master the steps involved in trading and investing in the FTSE 100. With FCA regulated brokers, the procedures involved are pretty similar and straightforward. They can only vary with a few requirements, like the minimum deposit. In this regard, let’s learn how to invest in the FTSE 100 with eToro.

Visit eToro’s Website to Create a Trading Account
Complete Account Registration and Basic Knowledge Test
Verify Your Identity and Location
Make the Required Deposit
Choose FTSE 100 and Start Investing

eToro’s website can easily be accessed directly through your search engine or by clicking the links we’ve shared on this page. Since the broker has a trading app, you can rely on it to execute your trades anytime you see fit. All you have to do is download eToro’s app from Google Play or the App Store on your mobile device.

In addition, do not forget to go through eToro;s terms and conditions and ensure it aligns with your investment needs before making a commitment.

Visit eToro’s Website

To complete the account registration process to trade FTSE 100, eToro will require you to share your personal information. These include name, email, physical address, phone number, date of birth, source of income, etc. You will also choose a username and create a password to secure your account.

Additionally, you will complete a simple test for eToro to determine a suitable trading package and leverage limit that fits your skill level.

Account Registration and Basic Knowledge Test on eToro

The Financial Conduct Authority (FCA) requires all brokers to verify the identities and locations of all traders before their trading accounts are fully activated. This standard procedure is put in place to make online trading in the UK safe. In this regard, you will share a copy of any document validating your identity, such as your passport or driving license. What’s more, eToro will request a copy of a utility bill or bank statement to verify your location.

identity verification on eToro

Once your trading account is fully activated and eToro has sent you an email confirmation message, you will make a deposit to invest in FTSE 100. eToro’s minimum deposit is £50, which can be made via various payment methods, including bank transfers, credit/debit cards, and e-wallets. Since we believe the broker charges high trading fees, we encourage you to confirm whether you can afford the broker before creating a trading account.

Deposit requirement on eToro

At this point, eToro will redirect you to the indices market, where you will choose FTSE 100 to complete your purchase. Besides trading the asset as CFDs, you can also invest in FTSE 100 ETFs, which at eToro is commission-free.

Remember, market analysis is crucial in trading FTSE 100 successfully. So, have a solid trading plan to avert losses in this activity.

FTSE 100 on eToro

Tips on How to Choose the Best Broker for Investing in FTSE 100 in the UK

The FTSE investment requires the support of the best broker to maximise your chances of making profits in the activity. Finding the best broker means considering elements that complement your trading needs. If you are new to trading, below are the factors to consider when choosing a broker for investing in FTSE 100 in the UK.

This element should be a priority before checking other factors that make a broker the best for FTSE 100 investment. In the UK, the best broker for investing in FTSE 100 should be licensed and regulated by the FCA.

Choosing unregulated brokers is risky, and you can lose your funds to scammers who have dominated the UK financial market. Unregulated brokers will also not let you trade under the best conditions, and taking legal actions against them in case of a dispute will also be impossible.

Any trader or investor will love to use a broker with a trading platform that executes trades fast and is reliable. This means having a trading app to help you manage your FTSE 100 investments whenever you cannot access your desktop.

In addition, you should be able to rely on the broker for research and market analysis tools. Beginners can also build their skills using learning resources and a demo account.

Choose a broker that offers FTSE 100 index and other major indices such as Dow Jones Industrial Average, S&P 500, NASDAQ 100, and more to diversify your portfolio. We also advise you to consider a broker with access to other financial markets like forex, commodities, cryptocurrencies, etc. This is so that in case you want to try something new, it will be easier for you to do so rather than going through the process of finding another broker.

Using too big of a budget investing in FTSE 100 is risky and can heavily affect your nest egg if you end up with a loss. In this case, it is wise that you start your investment venture with little money and increase the amount as you become more skilful.

Simply put, invest in FTSE 100 with money you are comfortable losing. Therefore, check a broker’s minimum deposit, commissions and spreads, inactivity fee, deposits and withdrawal costs, etc. and ensure they fit in your budget.

Many traders and investors choose the wrong payment methods to transact with and end up getting frustrated due to the conditions attached to those payment methods. Brokers mostly allow transactions using debit/credit cards, e-wallets, and bank transfers. Therefore, take your time to choose a mode of payment that works best for you when selecting a broker for the FTSE 100 index investment.

Even though we always insist that you consider your investment requirements when choosing a broker, it is important that you also consider other traders’ reviews and recommendations based on their experiences.

By doing so, it will be easier for you to note the elements that make a broker a considerable choice and those that will limit your investment capabilities. So, go to Google Play, the App Store, and Trustpilot to sample and analyse honest user comments and ratings.

FTSE 100 Share Price Today

FTSE 100 share price has been fluctuating throughout the years, and knowing the current share price of the index can be a challenge. Below, we have prepared a live chart to give you the current share price of FTSE so that you can easily track the performance of the index. The chart also contains historical data and more information that is useful in market analysis.

About FTSE 100

About FTSE 100 index

The Financial Times Stock Exchange 100, also known as FTSE 100 or footsie, is a share index containing top 100 companies. These companies have the highest market capitalisation and are listed on the London Stock Exchange. Founded in 1984, the index is operated by the FTSE Group, which is also a subsidiary of the London Stock Exchange.

FTSE 100 is the most popular stock market indicator in the UK. Other related indices include FTSE 250, FTSE 350, FTSE SmallCap Index, and FTSE Fledgling index. You can buy the FTSE 100 index fund or trade the asset as CFDs or ETFs using a broker like those referenced above. Some of the company stocks listed in the FTSE 100 include Admiral Group, Aviva, British American Tobacco, GlaxoSmithKline, Tesco, Unilever, to name a few. 

FAQs

How do companies qualify to get into the FTSE 100?

For a company to be included in the FTSE 100, it should be listed on the London Stock Exchange. The company should also be among the top 100 companies in the UK based on market capitalisation. This means that a company can lose its listing in the FTSE 100 once its market capitalisation drops.

What companies in the FTSE 100 are the best to invest in?

Most of the companies included in the FTSE 100 are popular. However, since their performances vary over time, it will be challenging to tell which company has the best profit potential. So, the best company to invest in will depend on how well you understand its performance and can strategise.

Is FTSE 100 a good investment in 2022?

Absolutely. FTSE is a popular index not only in the UK but globally. Even though its share price has been fluctuating, the index has witnessed good returns. This means that FTSE 100 can be lucrative with good planning and strategy.

How do you start investing in the FTSE?

We usually advise beginner investors to start FTSE trading by learning its share price performance and conducting a thorough analysis. Then, choose the best broker and create a trading account to access the index. Other than buying the index fund, most brokers will allow you to trade FTSE 100 as CFDs and ETFs.

How do companies qualify to get into the FTSE 100?
What companies in the FTSE 100 are the best to invest in?
Is FTSE 100 a good investment in 2022?
How do you start investing in the FTSE?

Conclusion

We hope that this guide has been helpful and you are now ready to try investing in the FTSE 100. However, before you begin, take your time to learn index trading and practice the activity using a broker’s demo account. 

Remember, research and market analysis are crucial in FTSE 100 investing. So find a broker that will support you with the necessary tools to maximise your potential. We have listed such brokers above to choose from. Alternatively, you can take advantage of our guide to find the best broker for investing in the FTSE 100. 

Adam Jarfjord

is our leading content maker and head of the content department. For Adam, trading is not only a job but also a passion for more than 5 years. He has many years of experience in the financial sector and honestly admits that he is in love with his job.

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