anna coulling trades the ftse 100Hello and welcome to another of my financial trading sites where I hope to explain all you need to know in order to be successful in betting on the $TSE 100e of the most widely traded instruments, yet ironically one of the least understood by the majority of traders. Indeed $tse bettingincreasing in popularity partly due to the diverse products now being offered by the spread betting companies, but also by new markets which are now developing such as in binary betting with binary bets, or in the more established fixed odds with companies such as bet on markets. Whichever method you choose, and I will cover them all in detail, along with ftse bet strategies, then in order to succeed it is vital that you have a deep understanding of the instrument you are trading which in this case is the FTSE 100 $ndexd this is where most traders fail. We all think we know what the FTSE 100 index is, but scratch below the surface and even professional traders will have little or no knowledge of how the index is constructed, how it operates, and more importantly its inter-realtionship with the $TSE futuresket. So before we rush off to spread bet ftse contracts or develop our ftse trading system, let’s start by taking a deeper look at the FTSE 100 and what makes this instrument so attractive as a speculative instrument to us as traders.

FTSE 100 Introduction

Ask anyone in the world to name a principle stock market index, and the chances are that they will come up with the FTSE100 at the top of their list, closely followed by the Dow Jones, with the Nikkei a close third. The reason for this is simple – the FTSE100 is the most widely recognised and reported stock market index in the world, as it represents the public face of the London Stock Exchange, one of the oldest and most revered exchanges in the world. In addition, London is often considered to be the trading capital of the world, and these factors combine to bestow on the FTSE100 a ‘gold standard’ status. Whether you subscribe to this view or not, the fact remains that many of those involved in trading, investing, or speculation, simply take the index at face value, failing to appreciate that the beneath the apparent simplicity of a single market number hides a far more complex and complicated market indicator, and as we will see shortly, all is not what it seems on the surface. For you to be successful in ftse betting, then you will need to have a much deeper understanding of the $tse 100 11; it is simply not enough to know that it is a leading indicator of UK equities ( which in itself is a myth as we will see shortly). Bet on the ftse 100, or ftse 250 or indeed any other index with such limited knowledge and you will lose. So, what do you need to know before getting started? The short answer is as much as possible, but here are some of the items I propose to cover in the following pages. Firstly, and perhaps most importantly is an understanding of which companies constitute the FTSE100 and how they are selected.

Secondly you will need to understand the relationship between the cash market and how the various derivative instruments are created from, and relate to, the underlying cash market, and finally you need to appreciate how the index is calculated and reported, and what the index figure is that you are actually trading, whether this is in a ftse spread betting account, in one of the new binary bets, or perhaps a fixed odds bet. Whichever is your chosen method of ftse betting, the fact remains that just like any other financial market, you need to understand and study the financial instrument you are proposing to trade, and the ftse 100 is no different. Unfortunately the simplicity and popularity of trading this leading index, trap many unwary traders who lose money fast – don’t be one of them. So let’s look in detail at the ftse 100 and scratch beneath the surface of this simple yet complex instrument.

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