Barratt Developments and Taylor Wimpey join the FTSE 100 in quarterly shake-up
Home-builders Barratt Developments and Taylor Wimpey will join the FTSE 100 index, replacing Petrofac and IMI, it has been announced today.
The latter two have recently been hurt by crumbling commodity prices amid a global sell-off.
Jimmy Choo, Allied Minds, CLS Holdings, Game Digital, Greggs and Spirit Pubs will join the FTSE 250.
EnQuest, Fenner, Ferrexpo, Foxtons, Hochschild Mining and Spirent Communications fell out of the FTSE 250 and will join the FTSE Small Cap Index.
The decision, which was made by a committee of market experts today, will become effective after market close on December 19.
How are stocks promoted?
The indices are changed every quarter to ensure investors know which are the biggest companies listed on the FTSE.
Eligible companies are ranked in order of their market value, which is a company's share price multiplied by the number of shares issued.
A committee meets to determine which companies will be promoted into or demoted from the FTSE100, FTSE250 and so forth.
If a company that's in the FTSE 250 climbs into the top 90 companies, it is eligible for entry into the FTSE 100. If a FTSE100 company drops to or below the 111th position, it could slip into the FTSE 250.
- FTSE 100: the biggest 100 companies as per market capitalisation.
- FTSE 250: the next 250.
- FTSE 350: includes all of the above.