Tuesday marked the 15 year anniversary of the FTSE 100's 6,930 peak on 30 December 1999. If you invested in this market and reinvested the dividends at that point you would still have made a gain, even though at around 6,600 the index is below the level it was then. The best performing funds, meanwhile, have done even better.
The main FTSE 100 Index does not include the dividends paid by the companies in it, but dividends are a significant part of the return investors receive for holding shares. An investment of £10,000 in the FTSE 100 on 30 December 1999 would now be worth £15,213 with dividends reinvested, and would have been back in the black by 27 January 2006, according to research by broker Hargreaves Lansdown.
The FTSE 100 also excludes medium and smaller companies which have outperformed large-caps over the last 15 years. £10,000 invested in the FTSE 250 since December 1999 would now be worth £36,306, with dividends reinvested.
The FTSE All Share encompasses large, small and medium companies, and has turned £10,000 into £17,206 with dividends reinvested, since December 1999. "This figure encompasses both dividends and medium and smaller companies, so best represents how the UK market as a whole has performed," said Laith Khalaf, senior analyst at Hargreaves Lansdown.
Value of £10,000 invested on 30 December 1999*
| FTSE 100 no dividends | £9,137 |
| FTSE 100 dividends reinvested | £15,213 |
| FTSE 250 no dividends | £23,936 |
| FTSE 250 dividends reinvested | £36,306 |
| FTSE Small Cap no dividends | £13,635 |
| FTSE Small Cap dividends reinvested | £20,005 |
| FTSE All Share no dividends | £10,500 |
| FTSE All Share dividends reinvested | £17,206 |
Source: Hargreaves Lansdown, all performance data 30/12/1999 to 16/12/2014
But the five best performing mainstream UK funds over this period have done even better. These include Invesco Perpetual Income (GB0033053827) and High Income (GB0033054015) which were run by star manager Neil Woodford until March this year, when they were taken over by Mark Barnett.
Fidelity Special Situations (GB0003875100) was run by Anthony Bolton until 2008.
Only GAM UK Diversified (GB0002426426) has had one continuous manager between 1999 and 2014 - Andrew Green.
"There has been a lot to gain from being invested with the right active managers over this period," said Mr Khalaf. "Despite the investment period starting with a market nose dive, these managers have still managed to quadruple investors' money over the long term."
Best five performing UK funds 1999-2014*
| Fund | Value of £10,000 invested 30/12/1999 (£) |
| Schroder Recovery | 45,798 |
| Fidelity Special Situations | 43,404 |
| GAM UK Diversified | 42,595 |
| Invesco Perpetual High Income | 42,017 |
| Invesco Perpetual Income | 41,898 |
Source: Hargreaves Lansdown, performance data 30/12/1999 to 16/12/2014, *Excluding smaller companies funds
