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FTSE 100 vs S&P 500
Find out the key differences between the FTSE 100 and the S&P 500, plus some important points to consider before investing.
The S&P 500 and FTSE 100 are major stock market indices. While the S&P 500 consists of 500 leading stocks from various US exchanges, the FTSE 100 includes the top 100 stocks from the London Stock Exchange. There are significant differences between them.
For a start, if you invest in the S&P 500, your money will be converted from pounds into dollars. In addition, the S&P 500’s juggernauts are overwhelmingly fast-growing tech companies. Meanwhile, the FTSE 100 is weighted towards slow-and-steady companies in the insurance, banking, mining and hydrocarbon industries.
We look at more differences between the S&P 500 and FTSE 100 below.
What’s the difference between the S&P and the FTSE?
The S&P 500 and FTSE 100 are both indices. Each index is simply a collection of stocks that are organised in some way – in both cases, they are “country coverage” indices, which means that they’re designed to represent the performance of the stock market in their respective countries. You can also get exchange-based indices, such as the Nasdaq-100, or sector-based indices, which might have themes such as technology or insurance. Despite being the same type of index, the FTSE 100 and S&P 500 have plenty of differences, such as in their size, concentration, quality, valuation and diversification.
S&P 500
- Apple
- Microsoft
- Amazon
- Facebook inc A
- Alphabet Inc A (Google)
- Johnson & Johnson
- Berkshire Hathaway
- Visa
- Procter & Gamble
FTSE 100
- AstraZeneca
- Unilever
- HSBC Holdings
- Diageo
- GlaxoSmithKline
- British American Tobacco
- BP
- Royal Dutch Shell A
- Rio Tinto
- Reckitt Benckiser
FTSE 100 vs S&P 500: Which is bigger?
Spoiler alert: The S&P 500 is bigger
The S&P 500 holds 500 stocks, while the FTSE 100 just holds 100. You can get the FTSE250 and 350 as well as the S&P100, which work in exactly the same way, but these 2 are the most popular in their respective countries.
The FTSE 100 is a lot smaller than the S&P 500 in terms of market capitalisation – the FTSE 100 has a market cap of around £1.6 trillion, while the S&P’s market cap is around $25.6 trillion (about £19.5 trillion). That makes the S&P 500 about 12 times the size of the FTSE 100 in terms of market cap.
FTSE 100 vs S&P 500: Which is worth more?
Spoiler alert: The S&P 500 is worth more
As mentioned above, the market cap of the S&P 500 is 12 times that of the FTSE 100, but it does hold 5 times the stocks. Even considering this, the S&P 500 is worth more than the FTSE 100.
FTSE 100 vs S&P 500: Concentration
There are 505 stocks in the S&P 500 and 101 stocks in the FTSE 100 — this is because of the different classes of shares that some companies have. With the S&P 500 having 5 times the shares that the FTSE 100 has, the FTSE 100 is, therefore, a more concentrated index. The top 10 stocks, which you can see below, make up more than 40% of the index.
The top 10 stocks in the S&P 500 (also listed below) make up just short of 30% of it.
FTSE 100 vs S&P 500: Stock quality
Spoiler alert: The S&P 500 has riskier technology stocks, while the FTSE 100 has more cyclical stocks.
The top stocks in the FTSE 100 are vastly different from the top ones in the S&P 500, and the rest of each index reflects this a fair amount. The S&P 500 is made up of a lot of technology stocks (74, to be exact). Meanwhile, just 7 stocks on the FTSE 100 are technology stocks.
The FTSE 100 has more stocks that are considered to be “cyclical”. Some investors think of these as recession-proof, as they tend to perform even in a recession – this isn’t necessarily the case. This would explain why the FTSE 100 hasn’t seen the same growth as the S&P 500, as it’s made up of stocks for financial companies and consumer staples companies, while the S&P 500 is made up of higher-risk technology stocks.
FTSE 100 vs S&P 500: Which is more diversified?
Spoiler alert: The best way to get diversification is to choose both
Statistically, the S&P 500 is more diversified than the FTSE 100, with a more equal weighting of each category across the index, but the FTSE 100 holds a higher concentration of “safer” cyclical stocks against the S&P’s “riskier” growth stocks. If you’re looking for diversification, your best bet is to go with both of them.
Platforms where you can invest in the FTSE 100 and the S&P 500
These trading apps allow you to invest in companies within each index directly or to invest in funds/ETFs (exchange-traded funds).
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What’s the best S&P and FTSE index fund?
Here are some of the best-performing S&P 500 and FTSE 100 funds according to JustETF:
| Icon | Fund | 5-year performance | 1-year performance (to September 2023) | Link to invest |
|---|---|---|---|---|
 | Invesco S&P 500 (SPXP) | 72.84% | 6.20% | Invest with IGCapital at risk |
 | Xtrackers S&P 500 Swap (XSPX) | 72.64% | 6.11% | Invest with IGCapital at risk |
 | HSBC S&P 500 (HSPX) | 71.12% | 6.12% | Invest with IGCapital at risk |
 | Vanguard S&P 500 (VUSA) | 70.83% | 5.98% | Invest with FreetradeCapital at risk |
 | iShares Core S&P 500 (CSP1) | 70.82% | 5.98% | Invest with eToroCapital at risk |
 | SPDR S&P 500 ETF (SPY) | 70.54% | 5.93% | Invest with IGCapital at risk |
| Icon | Fund | 5-year performance | 1-year performance (to September 2023) | Link to invest |
|---|---|---|---|---|
| HSBC FTSE 100 (HUKX) | 20.70% | 6.04% | Invest with IGCapital at risk |
| Vanguard FTSE 100 (VUKE) | 20.60% | 6.06% | Invest with FreetradeCapital at risk |
| iShares Core FTSE 100 (CUKX) | 20.53% | 6.05% | Invest with eToroCapital at risk |
| Xtrackers FTSE 100 (XDUK) | 20.35% | 6.04% | Invest with IGCapital at risk |
 | Lyxor FTSE 100 (100D) | 19.76% | 5.87% | Invest with IGCapital at risk |
| Invesco FTSE 100 (S100) | 19.62% | 5.95% | Invest with IGCapital at risk |
All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Past performance is no guarantee of future results. If you’re not sure which investments are right for you, please seek out a financial adviser. Capital at risk.
A green metals boom could make the FTSE 100 shine
Money expert Mark Tovey answers
The FTSE 100 is home to 6 world-class mining companies, meaning it could strike it big in a green metals bull market.
According to metals expert Guillaume Pitron, “Over the next generation, we will consume more minerals than in the last 70,000 years.” That is due to the world’s increasing adoption of resource-hungry “green” technologies. The battery in an electric car, for example, needs lithium, manganese, cobalt, graphite, steel and nickel to run.
In previous commodities bull markets, the FTSE 100 has tended to outperform other indices. In 2022, its focus on commodities paid off as Russia’s invasion of Ukraine caused price shocks in oil, gas, nickel and other raw materials.
By owning FTSE 100 miners like Anglo American, Antofagasta, BHP Group, Fresnillo, Glencore and Rio Tinto, investors can get exposure to a wide range of critical metals. However, commodities markets are viciously cyclical. If global economic growth slows, that could be a major downer for mining companies.
What are the top holdings in the S&P 500 and FTSE 100?
Here are the top holdings of the S&P 500 and the FTSE 100. As you can see, the top 10 stocks in the S&P 500 contain a lot of technology companies, making up a large proportion of the top stocks. Meanwhile, the top stocks of the FTSE 100 are mainly healthcare, industrial and energy stocks.
| S&P 500 | FTSE 100 | ||||
|---|---|---|---|---|---|
 | Apple | 6.1% |  | AstraZeneca | 6.0% |
 | Microsoft | 5.8% |  | Unilever | 5.8% |
 | Amazon | 3.9% | | HSBC Holdings | 4.5% |
 | Facebook inc A | 2.2% |  | Diageo | 4.2% |
 | Alphabet Inc A (Google) | 2.2% |  | GlaxoSmithKline | 3.7% |
How to invest in the S&P 500 and FTSE 100
- Find an S&P 500 or FTSE 100 ETF, index fund or mutual fund. Some index funds track the performance of all stocks on the index, whereas others only track a certain number of stocks or are weighted more towards specific stocks. You should select the fund that best suits your investment goals.
- Open a share-trading account. To invest in the funds, you’ll need to open a trading account with a broker or platform. Keep in mind that some index funds may only be available on certain brokerages or platforms. The providers in our comparison table below let you invest in US shares. We’ve included some index funds below that are listed on the London Stock Exchange (LSE).
- Deposit funds. You’ll need to deposit funds into your account to begin trading. Some brokers may charge you deposit fees, or you may need to pay a forex fee to convert your pounds into US dollars.
- Buy the index fund. Once your money has been deposited, you can then buy the index fund. You’ll generally pay a small annual fee to invest in an ETF or index fund.
Best trading platform for index funds: Saxo
We chose Saxo as our top pick because:
- Invest in over 19,000 stocks, funds and investment trusts.
- Use their award-winning trading platforms.
- Customer support available 24 hours a day.
Need to know: Opening a Saxo share dealing account requires a high minimum investment (£500).
Read our review of Saxo.
Which index has better stock diversification?
Statistically, the S&P 500 is more diversified than the FTSE 100, with a more equal weighting of each category across the index, but the FTSE 100 holds a higher concentration of “safer” cyclical stocks against the S&P’s “riskier” growth stocks. If you’re looking for diversification, your best bet is to go with both.
| S&P 500 | FTSE 100 | |
|---|---|---|
| Type of stocks | Large-cap US equities | Large and mid-cap UK equities |
| Number of holdings | 505 | 101 |
| Top sectors | Information Technology (IT) 27.5%, Healthcare 13.3%, Consumer discretionary 12.4%, Financials 11.4%, Communication Services 11.2% | Healthcare 11.6%, Industrial goods & services 10.9%, Energy 10.2%, Basic resources 9.7%, Personal care drug and grocery stores 9.3% |
| Exposure to global economy | Greater | Slightly weaker |
| Past performance | Stronger | Weaker |
| Availability of ETF | Wider | Weaker |
Compare S&P 500 and FTSE 100 trading platforms
Table: sorted by promoted deals first
These trading apps allow you to invest in companies within the indexes directly or to invest in funds/ETFs.
Bottom line
When comparing the S&P 500 and FTSE 100, it’s important to consider various factors. Currency fluctuations play a role, as a stronger US dollar can benefit investments in the S&P 500 when converted to pounds, while a stronger pound can have the opposite effect. Investors can mitigate this risk by using currency hedging strategies.
Another aspect to consider is dividend yields, with the FTSE 100 offering a higher yield of nearly 4%, while the S&P 500 has a comparatively lower yield of 1.5%.
Additionally, the price-to-earnings (P/E) ratios differ, with the FTSE 100 having a P/E ratio of around 11, while the S&P 500 has a ratio of 20. These ratios can vary significantly depending on the sector in which a company operates.
Also, the FTSE 100’s exposure to mining companies positions it well for potential gains in a green metals boom driven by the increasing demand for minerals in “green” technologies. However, it’s important to note that commodities markets are cyclical and subject to global economic conditions.
Ultimately, investors seeking growth may lean towards the S&P 500, while those looking for stability and higher dividend yields may prefer the FTSE 100.
Frequently asked questions
All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Past performance is no guarantee of future results. If you’re not sure which investments are right for you, please seek out a financial adviser. Capital at risk.
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