Compare Brokers For Trading FTSE 350

Looking for brokers for trading ftse 350? We have compared 21 broker accounts (out of 147) that are suitable for you below.

We found 21 broker accounts (out of 147) that are suitable for FTSE 350.

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Between 54-87% of retail CFD accounts lose money. Based on 69 brokers who display this data.

The Ultimate Guide to

FTSE 350 Index

The FTSE 350 stock index represents the performance of the 350 largest companies which have their listing on the London Stock Exchange. The index is actually a combination of the FTSE 100 index and the FTSE 250 index. The FTSE 100 index is a listing of the 100 largest companies on the London Stock Exchange. The FTSE 250 index is a listing of the next largest 250 companies traded on the London Stock Exchange. The FTSE 350 began trading in October 1992.

FTSE is an acronym for Financial Times Stock Exchange. However, the acronym is slightly misleading as FTSE is not a stock exchange. Instead, “FTSE”, or FTSE International Limited, are a company which specialise in index calculation. They are owned by the London Stock Exchange Group and the components of the indices are traded on the London Stock Exchange (LSE).

The FTSE 350 covers 18 different supersectors, as classified by the Industry Classification Benchmark (ICB), over ten different industries. The industries represented are oil and gas, basic materials, consumer services, consumer goods, telecommunications, financials, healthcare, industrials, technology, and utilities. Financials constitute the largest industry within the index at 25.4%.

Which companies are listed on the FTSE 350?

The ten largest companies in the FTSE 350 include HSBC Holdings, British American Tobacco, Royal Dutch Shell (A shares), BP, GlaxoSmithKline, Royal Dutch Shell (B shares), AstraZeneca, Vodafone Group, Diageo and Unilever. These ten companies represent 35.8% of the entire index. The largest company, HSBC Holdings, represents 6.4% of the index.

Source: FTSE 350 Index Factsheet 30 June 2017

How is the value of the FTSE 350 derived?

The FTSE 350 is reviewed on a quarterly basis in order to determine if the index needs to be changed or adjusted. The quarterly changes are announced after the close of business on the first Friday of March, June, September, and December. If required, implementation occurs on the third Friday of March, June, September, and December.

Companies are added or removed from the index based on market capitalisation. The formula for market capitalisation involves multiplying the stock price by the number of shares outstanding.

More specifically, the FTSE 350 is an arithmetic weighted index based on the market capitalisation of each company within the index. The value of the FTSE 350 is the summation of the capitalisation of all companies within the index divided by a divisor. Therefore, the price movement of a larger company will have a greater effect on the index versus a smaller company.

The divisor used in the daily calculation is periodically adjusted for any capital changes in the companies which comprise the index. For example, if a company increases the number of its outstanding shares, the market capitalisation of that company will increase. Consequently, the index divisor is adjusted to maintain a constant index value.

In order to ensure the FTSE 350 index daily values remain comparable over time, a base starting date is chosen along with an arbitrary value. Specifically, the starting date for the FTSE 350 index is December 30, 1983. The beginning arbitrary value is 100.

The daily adjustments used by all FTSE indices are based on the Paasche formula. In layman’s terms, essentially it adjusts the divisor for the index in order to reflect any changes that may have occurred as a result of an increase in a corporation’s outstanding shares. The Paasche formula is also known as a current-weighted formula.

How to trade the FTSE 350

The most popular FTSE indices are FTSE 100, FTSE 250 and FTSE 350. However, only the FTSE 100 and 250 are available for trading as a stock index futures contract. All FTSE index products were originally traded on the London International Financial Futures & Options Exchange (more popularly known as LIFFE). Today, FTSE index products are traded on the Intercontinental Exchange. FTSE products moved to the Intercontinental Exchange in 2013 as a result of the purchase of NYSE Euronext by the Intercontinental Exchange. In 2014, the name was changed to ICE Futures Europe.

CFDs are fairly similar to a futures contract. The major similarity between the two instruments is the amount of leverage involved. Both contracts offer a great degree of leverage. CFDs tend to be slightly more leveraged than a futures contracts. For example, the required initial investment for a CFD can be approximately 2% of the value of the underlying index or asset, whereas a futures contract can be approximately 5%.

Advantages of trading FTSE 350 as a CFD

CFD transactions allow the trader to speculate on an asset without actually owning or taking delivery of the asset. Additionally, traders are allowed to “sell short” an asset using CFDs. If the trader believes an asset will decline in value, he/she can simply sell the asset through a CFD transaction. Later, the trader can buy back the position in order to offset the trade.

Brokers collect their fee on a CFD transaction through the spread price, which is the difference between the buy price and the sell price. There are usually no commissions associated with CFDs.

CFD transactions are particularly popular in the UK because the trading product does not carry stamp duty. Additionally, for tax purposes, CFD losses can be offset against any returns.

Traders and speculators should always remember that CFD transactions are highly leveraged instruments. Therefore, both gains and losses will be magnified. Traders who want to learn more about CFD products should contact a regulated brokerage firm.

There are, however, very few brokers that offer a CFD that uses the FTSE 350 as the underlying. Traders can spread bet on the FTSE 350 sectors – IG offer a Daily Funded Bet (DFB) or a futures bet (which is quarterly). IG also offer shares in all of the companies that make up the index.

Alternatively, CFDs, ETFs (exchange traded funds), futures and other products can be traded on the FTSE 100, and the FTSE 250.

Regulated brokers offering such products include eToro and LCG.

Current Value of FTSE 350

Source: Google Finance – 27th July 2017

Between 54-87% of retail CFD accounts lose money. Based on 69 brokers who display this data.