Unlike the US Dow Jones index, which has seen fewer changes over the past years, the FTSE has evolved to reflect the global economic revolution. This creates issues for investors to consider. Through mergers, failures, promotions, demotions, new listings and globalisation the FTSE has evolved to become a less UK-centric index and instead more closely reflecting the fortunes of the global economy.
To be fair, the index has never been a very good reflection of the UK economy — with key industries like motor manufacturing and technology either unrepresented or barely evident — but it has become even less of a bellwether for our leading industries. These were businesses built to meet the demands of the UK consumer. The index had a number of firms which bore the national name too: British Aerospace and British Petroleum to name but two.
For anyone looking to benefit from a burgeoning UK economy by investing in a stock market, the FTSE was the first port of call. Only 28 of the original companies remain listed on the FTSE Below, we have used the names they held in and referenced what they did. For some, the nature of their business has evolved. The components of the index have changed dramatically over the past three decades, as we outline below. But the index has still offered decent performance throughout.
If you include dividends the return is even greater. Past performance, of course, is not a guide to the future and investors should also consider the effect of any charges. Below we list the names that have disappeared in the prev. Some have been taken over. Boots, founded in Nottingham in , was bought by a Swiss private equity firm in , the first FTSE member to be taken over by a private equity firm.
Another example is Allied Lyons. Back then it made a range of food and drinks including Lyons Maid ice lollies and Tetley beer. It began to experience problems in the late s and merged with Domecq in It ceased trading in after being taken over by Pernod Ricard.
A recent example was Cadbury Schweppes, confectionery firm and maker of Dairy Milk chocolate bars. Many have failed to survive in any form. With an onslaught of rivals, such as Ikea , it finally closed down in December Woolworths, pictured above, wasn't in the index at the start but was promoted soon after.
As with MFI, it failed during the financial crisis with the last stores closing in early Other original FTSE members still exist but are no longer among the biggest listed companies such as bookmaker Ladbrokes. We cover some of the stories of those companies at the foot of this article:. This is important. For example, a strong dollar can be good for UK companies that make their money in dollars. Once the dollar revenues are converted into local currency it would be worth more.
It is part of a constant cycle of healthy change for the stock market. Companies are bought, merged, or simply decline and leave the top flight. Some even go bust. But meanwhile new companies, often in new industries, constantly emerge to take their place. As the index has evolved so too have the sectors which dominate it. We looked at the available data, going back to Over the last ten years, consumer staples and healthcare have made big gains in their makeup of the FTSE The financial sector, made up largely of banks, and energy stocks, including BP and Royal Dutch Shell, are still among the biggest components but their importance has waned over the last decade.
It is useful to understand the sectors weightings in the context of a wider portfolio. Holding a large amount of money in the UK, may mean an investor has a large exposure to commodity stocks and therefore may not want to invest heavily in commodity stocks elsewhere.
The FTSE continues to evolve with its constituents being reviewed every quarter. The index is changed to ensure it is a fair reflection of the current top companies listed on the London Stock Exchange. Skip to main content. LSEG 12 Nov , You are here Home About LSEG.
Explore all. Media Centre. Our word is our bond. True in Just as true today. July London Stock Exchange becomes a public company listed on its own market. September MillenniumIT, a Sri Lanka-based technology solutions provider serving the global capital markets industry, is acquired.
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