Top 10 most traded shares in the UK

How to find the UK’s most actively traded stocks

There are numerous ways to identify the most actively traded stocks. Perhaps the most popular method used by traders, is to assess a stock’s trading volume – the amount of stock which has been traded during a given period of time.

Traders use trading volume as an assessment of the popularity of a stock. Popular stocks can provide an opportunity to go long or short with a particular trend, as they are likely to be highly liquid.

With that in mind, here are the top 10 most traded shares in the UK, based on the trading volume of IG clients using data for leveraged trades.¹ The companies included here are listed on the London Stock Exchange (LSE) and are also constituents of the FTSE 100:

1. Lloyds Banking Group
2. Barclays
3. Vodafone Group
4. ITV
5. Centrica
6. BT Group
7. NatWest
8. International Consolidated Airlines Group SA (LSE)
9. J Sainsbury
10. Glencore

What is the importance of trading volume?

Trading volume is important because it shows the current momentum of an asset’s price movements. If trading volume increases, it generally means that traders have a bullish or bearish view of the instrument.

Traders often look to volume as an indicator of possible trend continuations or reversals. On the stock market, for example, if a stock’s trading volume is starting to decline but its price remains high, it could be indicative of a possible trend reversal in the near future.

Conversely, if a stock’s trading volume is high and its price is also rising, it could be indicative of a trend continuation until such a time when volume outstrips price. When this occurs, there could be a possible crash in the stock’s price, which could see traders shift towards sell positions as the market becomes overbought and bearish.

Fundamental factors such as company announcements, including potential mergers and new senior leadership, can affect a stock’s trading volume. The same can be said for government releases such as changes in interest rates, and political uncertainty – such as Brexit – as well as data about a country’s economy. This last point is particularly true when talking about the shares of major banks – some of which are included in this list.

Learn more about fundamental analysis

Traders will sometimes seek out high-volume stocks because these are often more volatile and have increased liquidity than their less-traded counterparts. High volatility means that price movements are more common, and opportunities to profit might be more frequent as a result.

High liquidity is appealing for short-term traders, because it means that the market is saturated with participants to take the other side of your orders. As a result, your orders are more likely to be filled.

The table below details the top UK stocks, along with their trading volume and notional value for the six months ending 11 August 2019.¹

Britain's most traded shares

Lloyds Banking Group

Lloyds Banking Group – commonly known as Lloyds – is a British banking group with a market capitalisation of £39.74 billion and a trading volume of 381,103,345 for the six months ending 11 August 2019.¹ Banking stocks are some of the most traded stocks in the world because of the function which banks play in our daily lives.

Year to date at the time of writing (20 August 2019), Lloyds shares have lost a moderate 2.65% of their value. However, there have been some big declines throughout this period, notably a 25.42% drop from April to August 2019.

Lloyds, like other banks on this list, has experienced high trading volume in the months preceding the Brexit deadline. Many traders view this build-up period as an opportunity to take a position on the UK banking sector and economy as a whole – whether that be long or short.

Trade Lloyds stock

Barclays

Barclays is a British banking group, and its shares are the second most traded shares in the UK in terms of IG volume. A total of 152,759,768 shares changed hands from 11 February to 11 August 2019.¹

Barclay’s stock price experienced a slight decline on a year-to-date basis at the time of writing. This decline was around 7.21%, and it represented scepticism ahead of the Brexit deadline and the possibility of a no-deal outcome.

Barclays, just like the other banks on this list, performs an important societal service in that most consumers need a bank account, and many have more than one. It is for this reason that banking stocks often experience high trading volumes, as evidenced by Lloyds and Barclays taking the first and second spot on this list respectively.

Other things which can affect the trading volume of banking stocks are any central bank decisions or interest rate rises – which enable a bank to lend out money at a more profitable rate of interest, in turn increasing revenues and attracting traders.

Trade Barclays stock

Vodafone Group

Vodafone Group, with a market capitalisation of £40.60 billion, comes third on our list, with 151,257,014 shares traded in the six-month period ending 11 August 2019.¹ Its share price remained largely flat on a year-to-date basis, falling 3.34% by the time of writing.

However, Vodafone’s share price rallied following the rollout of its 5G network across a number of UK cities in July 2019. This makes Vodafone the second UK mobile phone network to roll out 5G, behind only EE.

Adding to this, as the fourth-largest provider of mobile phone networks in the world, Vodafone stock is considered one of the big four of the UK telecommunication sector – the others being EE, O2 and 3. As a result, traders tend to have more faith in Vodafone’s market performance when compared to some of the smaller, less well-known mobile phone network providers.

Trade Vodafone stock

ITV

ITV is the largest commercial-based terrestrial television network in the UK. Programmes such as This Morning, Britain’s Got Talent and The Voice – as well as sports coverage – have helped ITV to establish itself as a dominant fixture in many British viewers’ television habits.

Because competitors such as the BBC and Channel 4 are not publicly-listed, ITV stock is one of the main avenues through which traders can get exposure to the UK media sector. As a result, 46,621,624 shares of ITV were traded with IG in the six-month period ending 11 August 2019.¹

ITV’s share price had fallen 12.82% year to date at the time of writing. The decline in this period was brought about by weak first quarter (Q1) results in 2019, as well as the axing of one of its most popular shows – the Jeremy Kyle Show – in May 2019.

Trade ITV stock

Centrica

Centrica is a British energy and services company. Its main activities include the supply of electricity and gas to consumers in the UK, the US and the Republic of Ireland. Traders in the UK will likely know of Centrica’s subsidiary British Gas – which supplies over 12 million UK homes with their energy.

Centrica had an IG trading volume of almost 39,167,727 from 11 February to 11 August 2019.¹ Traders were shorting Centrica stock on the back of 2019 Q1 losses, as well as the loss of over 1 million customer accounts since Iain Conn took over as the chief executive officer (CEO) in 2015.

As a result, Mr Conn announced that he will resign from the company’s board by the next annual general meeting (AGM). As of 20 August 2019, Centrica’s share price had declined 76% since Mr Conn became CEO, and following his replacement, trading volume might remain high as traders rally on the news of his replacement.

Trade Centrica stock

BT Group

BT Group is a British telecommunication holding company, the parent of BT Global Services, BT Consumer and EE. BT Group had a trading volume of 38,823,709 for the six months ending 11 August 2019.¹

EE was the first mobile phone network to offer 5G in a number of UK cities – rolling out the service in late May 2019 – which did cause a brief upward rally of 7.87% in BT’s share price from 31 May until 18 June 2019.

That being said, on a year-to-date basis at the time of writing, BT stock had fallen 30.26% in value, a trend which indicates bearish market sentiment. This was partly a result of an announcement in May 2019 of falling profits, as well as a ‘sell’ rating assigned to the stock by Deutsche Bank late in June 2019.

Similar to banking stocks, the stocks of mobile phone companies and companies which provide mobile phone networks will always be in high demand because of the prevalence of mobile phone ownership in society.

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NatWest

NatWest – previously known as RBS – is one of the oldest banks in the world. From 11 February to 11 August 2019, 31,221,405 NatWest shares were traded with IG, putting it firmly in seventh position for the UK’s most traded stocks.¹

At the time of writing, NatWest stock had declined in value by 14.52% this year. This could be explained by an increase in short positions on UK banking stocks during the Brexit negotiations, and a perceived opportunity to profit given a predicted economic downturn in the UK economy in the event of a no-deal exit from the EU.

In fact, a number of US-based investment firms have taken considerable short positions on Lloyds, Barclays and NatWest stocks ahead of the Brexit deadline.

Trade NatWest stock

International Consolidated Airlines Group SA (IAG) (LSE)

International Consolidated Airlines Group – often shortened to IAG – is an aviation company registered in Madrid with its head office in London. IAG was formed through a merger of British Airways and Iberia in January 2011.

At the time of writing, IAG stock had fallen 30.30% year to date, indicating that this is a stock in which sellers were dominant. IG clients traded 30,290,848 shares of IAG between 11 February and 11 August 2019, with a notional value of £153,250,005.¹

IAG’s high trading volume in this period could, once again, be down to Brexit uncertainty and traders taking a bet that the possibility of a no-deal departure would cause disruption to travel between the UK and EU. Equally, it could have been due to increasing fuel prices – something which IAG mentioned in their 2018 annual report – on the back of unpredictable movements in the oil markets.²

Trade IAG stock

Sainsbury (J)

Sainsbury’s is the third-largest supermarket in the UK behind Tesco and Asda, in first and second respectively. Sainsbury’s celebrated its 150^th anniversary in 2019, and its largest shareholder is the Qatar Investment Authority.

For the six months ending 11 August 2019, Sainsbury stock had a total trading volume of 22,473,628 with IG clients.¹ This could be attributed to anticipation ahead of a possible merger which was meant to take place between Sainsbury’s and Walmart-owed Asda.

This merger fell through, meaning that Sainsbury’s trading volume might decrease in the backend of 2019. However, rumours have started to circulate that the CEO of Sainsbury’s, Mike Coupe, might resign before 2020 – making Sainsbury’s stock a key one to watch.

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Glencore

Glencore is the largest mining company in the world by revenue, which goes some way to explain its popularity with traders. Its trading volume of 21,604,412 from 11 February to 11 August 2019 with IG clients represents a notional value of £61,435,920.¹

Despite this, the price of Glencore stock had fallen 20.60% in 2019 at the time of writing. This could be because traders were taking short positions on Glencore ahead of Brexit, as well as the US-China trade war and increasing speculation over the possibility of a global recession.

What is certain is that Glencore is one of the most traded stocks in the UK, as well as the most traded mining and mineral company on this list.

Trade Glencore stock

How to trade the UK’s most traded stocks

The following four steps will help you to trade the UK’s top stocks:

1. Carry out fundamental and technical analysis
2. Choose a trading strategy and check your exposure to risk
3. Create an IG Bank account
4. Open, monitor and close your first position

Carry out fundamental and technical analysis

Before you start trading, it’s important to carry out analysis to determine why a stock is performing in the way that it is. Analysis should be both fundamental and technical, as each can enable you to analyse a company’s potential to earn you profits.

Technical analysis looks primarily at historical chart data and attempts to determine what an asset’s price is likely to do in the future based on what it has done in the past. Technical analysts will use indicators such as Fibonacci retracements, stochastic oscillators and on-balance volume to predict a market’s overall trend.

Learn about technical analysis

Fundamental analysis seeks to determine the profit potential of a company from financial statements, senior leadership and a company’s business model – among other things. Fundamental analysts look at how a company is being run, whether a particular industry is experiencing a slowdown, or the economic performance of an entire country to tell them whether or not to take a position on a particular asset.

Find out more about fundamental analysis

Choose a trading strategy

There are many trading strategies to choose from, and whichever will work best for you depends on your individual trading style.

For example, a scalping strategy is best suited to traders who are after small but frequent profits. Conversely, a position trading strategy is a longer-term strategy in which a trader attempts to profit from a sustained market trend.

You can create an IG Bank demo account to try out different trading strategies and see which strategy you prefer. A demo account is free, and it gives you CHF20,000 of virtual funds to practise with.

Create an IG Bank account

If you want to jump right in to speculating on the most traded shares in the UK, then you might want to create a live account rather than a demo account. On a live account, you can trade stocks through CFDs, and you can open an IG Bank account with no obligation to deposit funds until you want to actually place a trade.

Open, monitor and close your first position

When you have chosen your stock, carried out the relevant analysis and selected a strategy, you’re ready to start trading. To place a trade, simply open the deal ticket for your chosen market and – if trading CFDs – select either the ‘buy’ or ‘sell’ option, depending on whether you want to go long or short.

From this window, you can also select whether you want to add any stops or limits to your position, which can help to minimise losses and lock-in profits. If you want to close your position, you just need to make the opposite trade to the one you used to open it – a sell position when you’ve gone long, and a buy position when you’ve gone short.

It’s important that you monitor your investments and keep a track of any adverse price movements.

Sources

¹ IG internal data, retrieved August 2019
² IAG annual report, 2018