The benchmark index of the UK equity market is the FTSE 100 Index. This index is comprised of the 100 blue chip companies on the London Stock Exchange and is dominated by oil majors like Shell plc(SHEL) and BP(BP), banks (HSBC), drug firms (Astrazeneca – AZN) and consumer staple giants like Unilever (UL). As such, the FTSE 100 is not a true representation of the UK economy. Since many of the FTSE 100 firms generate a significant portion of their revenues overseas the performance of the index is dependent on the global economy than the domestic economy.
The FTSE 250 is a mid-cap index which is better gauge of the British economy. However this index is rarely mentioned in the media and is not as popular as the FTSE 100. There are many other indices that the index provider FTSE Russell has created. Some of the top ones are listed in the infographic below:
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Source: Quid Stuff
The following chart shows the total return of the FTSE 100 and FTSE 250 indices since 2012:
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Source: FTSERussell
Disclosure: No positions
