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The importance of indices


Every day, finance professionals across the world look to FTSE Russell  for index tools to help them manage their investment portfolios.

Inclusion in FTSE’s UK Index Series brings major benefits for companies listed on the Premium Segment of the Main Market and provides investors with a set of indices that measure the performance of the UK equity market. Indices are crucial for comparing performance against a peer group and support liquidity and capital-raising.

Increasing exposure
Becoming a constituent of the FTSE UK Index Series helps to build greater liquidity for Main Market companies by providing investors with clear and independent benchmarking of stocks, sectors and the market as a whole. It also creates the basis for portfolio trading by both active and passive investors. Institutional investors offering retail funds, which explicitly benchmark the FTSE 100, FTSE 250, FTSE SmallCap and FTSE All-Share indices, account for almost £50 billion of investment – over 60 per cent of which is held in tracker funds that are obliged to purchase exposure to the constituents of those indices.

Premium listed Main Market companies are potentially eligible for the FTSE UK Index Series, one of the most recognised in the world, which includes the well-known FTSE 100 Index. Standard listed companies and DRs are not eligible for inclusion in the FTSE UK Index Series.

FTSE UK Indices

For over 30 years, leading asset owners, asset managers, ETF providers and investment banks have chosen FTSE Russell indexes to benchmark their investment performance and create ETFs, structured products and index-based derivatives.

A core set of universal principles guides FTSE Russell index design and management: a transparent rules-based methodology is informed by independent committees of leading market participants. FTSE Russell is focused on applying the highest industry standards in index design and governance and embraces the IOSCO Principles. FTSE Russell is also focused on index innovation and customer partnerships as it seeks to enhance the breadth, depth and reach of its offering.

FTSE Russell is wholly owned by London Stock Exchange Group.

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