The Financial Times Stock Exchange 100 Index, also known as the FTSE 100 Index, is a stock market index that measures the market capitalization of the top 100 companies listed on the London Stock Exchange. It is regarded as a barometer of performance for companies subject to UK company law. The FTSE Group, a division of the London Stock Exchange Group, is the one to maintain the index.
The index is managed by the FTSE Group, which started as a joint venture between the Financial Times and the London Stock Exchange and is now a wholly owned subsidiary of the London Stock Exchange. When the market is open, it is measured in real time and released on a constant basis. The FTSE 100 is a stock market index that ranks the top 100 firms in the United Kingdom based on their full market value.
A company's net stock value is determined by calculating the company's share price by the total number of shares it has sold. Even though it is about overseas companies, the index's fluctuations are a strong indicator of how the economy is doing and are heavily influenced by exchange rates. A company must follow a range of FTSE Group criteria to be listed in the index, including having a complete listing on the London Stock Exchange with a Sterling or Euro denominated price on the Stock Exchange Electronic Trading Service, and completing nationality, free float, and liquidity measures.
Share values are weighted by free-float capitalization in the FTSE indexes, meaning that larger firms with more floating shares make a bigger difference in the index than smaller companies. The free float adjustment factor is the proportion of all traded shares that are freely available, and a company's free-float capitalization is the stock capitalization calculated by the free float adjustment factor.
The single figure quoted is the FTSE 100 amount, which is measured using the overall market capitalization of the constituent companies (along with the index value). Since the overall market capitalization is influenced by the actual share prices of the companies, the index valuation fluctuates over the day. The up or down movement of the FTSE 100 is measured towards the previous day's close.