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Testimonials

Great site Kenny.

Technical Analysis written in a straightforward way so that everyone understands.

There's only a small few who get it consistantly correct and you are certainly in that group. Chris


Thanks for putting this all together and sharing! BHW



Awesome Stuff! Kenny has shown time and time again the ability to show us direction in these markets. Khalsa



Kenny, I appreciate your insight and analysis. You make sense of what I can rarely see.

Thanks for sharing.
Gene
 



Took a gold short at 1240 just closed at 1203 :-)))))))))))))))))) ........ top call!!  Gekko

Ftse 100 Index Trading - How to Trade the Footsie 100

London Stock Market



Ftse 100 Index Trading

Ftse 100 index trading can offer a very useful alternative investment opportunity for traders and investors who want to diversify their portfolio to avoid some of the additional risks associated with investing in individual stocks. Even trading the Footsie 100 companies themselves does not make your investment portfolio immune from the potential of wakening up one morning to find 10-20% or more wiped off the its value.

Ftse100 index trading offers traders the opportunity to spread their risk across all of the Footsie 100 stocks in a single trade thereby offering a substantial cost saving over having to trade a number of stocks individually. To achieve anywhere near the same level of diversity, the dealing costs of trading a number of stocks individually would be extremely prohibitive and unrealistic for most traders and investors to consider.

By trading the Footsie 100 index itself, anyone can achieve this diversity and an extremely balanced portfolio with their risks spread across all sectors of the London share market for the price of one single trade.


Portfolio Hedging with Ftse100 Index Trading

Ftse100 index trading can also be used as a very useful and versatile instrument for hedging an investment portfolio against falling markets. Rather than being forced  in to liquidating an investment when the market is going against them, investors can chose to hedge their portfolio by taking a contrary position on the Footsie index to offset potential short term losses in value of their longer term investments.

Again, this index trading strategy can offer a substantial cost saving against the dealing costs of liquidating a number of long term positions and buying them back again at a later date.


How to Trade the Ftse 100 Index

There are a number of available means of trading indexes and here in the UK and some other countries, we have one of the most versatile and cost effective means available to traders and investors anywhere in the world through the many advantages of Financial Spread Betting. Trading through a spread betting account can offer a number of additional benefits over trading in  traditional trading accounts. 

  • Tax free trading*** - All profits from Financial Spread Betting in the UK are completely free from tax. That means there is no stamp duty to pay on trades but more importantly, there are no capital gains or income tax liabilities on any profits. 
  • No commission or brokers fees - Financial Spread Betting companies draw their profits from the spread between the buy and sell prices and do not charge any dealing fees. This feature coupled with fairly tight spreads (Many are as tight as 1 point for the Ftse 100) give traders a very low cost base for trading. In turn, the low costs involved with each trade give beginner traders an extremely versatile opportunity of trading with low stakes as well as offering substantial cost savings for larger investors too.
  • Go long or short - Make money trading when the stock markets are falling in exactly the same way as when they are rising, simply sell the market instead of buying. Still not sure how? Try our Interactive Spread Betting Tutorial.
  • Hedge your portfolio against falling markets - Selling the Ftse 100 index through a Spread Betting position can hedge a longer term investment portfolio when the wider market is falling. This allows the investor to take short term profits on the falling prices of the index to offset any short term losses against the larger trend.
Find out more about the advantages of Financial Spread Betting.


Ftse100 Index Trading with ETFs - Exchange Traded Funds

ETFS, Exchange Traded Funds are a way of trading the Ftse 100 index through a traditional stock broker account. These are funds that trade on the stock market in the same way as shares of a stock except that its assets are the funds cash and investments in the Ftse 100 index stocks.

ETF tracker funds attempt to mirror the underlying assets price movements as closely as possible but as they are independently traded funds, they will always be subject to the same pressures of supply and demand as any other stocks share price. It is perfectly possible that and ETF can under perform or  out perform its underlying market and when demand is low, the ETFs price could be trading at a discount just as it could be trading at a premium when markets are bullish.

This is a small selection of ETFs currently available which mirror the movements of the Footsie 100 index...

  • ISF  -  iShares 
  • HUKX   -  HSBC
  • XUKX  -  DB X-Tracke
This is a small selection of Short ETF s and Leveraged ETFs that  mirror the Footsie 100 index...

  • XUKS  -  DB X-Tracker (Short)
  • LUK2  -  ETFS Securities (2 x Short)
Please be aware that short etf s and leveraged ETFs are more complicated investments which carry greater risks.


Learn about Ftse Index Trading - Tax Free*** with

Financial Spread Betting




Ftse 100 Index Trading Options

Options are complex securities and can be extremely risky so it is essential to know exactly how they work before entering this type of trading but they are another versatile form of trading investment.

A Ftse 100 options contract gives the buyer the right, but not the obligation, to buy or sell the share market index at a specific price on or before a certain date. They can be used to take a long or short position on the Footsie 100  index and is also another way to hedge a longer term investment portfolio against falling markets. Learn more about Ftse Index options trading at Capital Spreads  -  Trade Ftse Index Options at (USA)



Ftse 100 Index Trading CFDs - Contracts for Difference

Contracts for Difference, CFDs trading is another alternative form of investment which also gives traders a extremely versatile way of trading the Footsie 100 index and Futures. It is very similar to Financial Spread Betting in many ways but with less favourable tax advantages. However, it is the big brother of Spread Betting to to the fact that it is far more widely available in other countries than Financial Spread Betting is.

Trading Ftse Index CFDs involves the buying or selling of contracts where a CFD provider agrees to deliver any profit to the investor that may be earned from the difference in price from the time the CFDs contract is entered into, to the time that it is sold. The CFDs investors liability is to pay the difference if the trade goes against them. Learn more about Ftse Index CFDs trading at Capital Spreads

***  Tax Law can change and may differ in other jurisdictions outside the UK


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