This is how much £1k invested in a FTSE 100 tracker 10 years ago would be worth now

first_imgThis is how much £1k invested in a FTSE 100 tracker 10 years ago would be worth now I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Peter Stephens | Friday, 31st January, 2020 | More on: ^FTSE Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Our 6 ‘Best Buys Now’ Shares Peter Stephens has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.center_img Image source: Getty Images. Investing in the FTSE 100 a decade ago could have been seen as a risky move by many investors. The index was trading at around 5,200 points after what had been one of the most challenging periods in its history.The financial crisis had caused the index to halve compared to its 2007 peak. Although it had delivered a strong recovery in the months following this decline, the prospects for the global economy continued to be highly uncertain in 2010.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Despite this, the index has gone on to deliver a 46% capital return since then. This works out as an annualised return of 3.8%. When dividends are added to this figure, the total return is over 8% per annum. As such, investing £1k or any other amount in a FTSE 100 tracker fund 10 years ago would have been a shrewd move, with it now likely to be worth around £2,150.Market cyclicalityWhile many investors would have felt nervous about buying FTSE 100 shares in 2010 due to the difficulties posed by the financial crisis, the track record of the index shows that it has always recovered from its downturns to post new record highs. Examples include the 1987 crash, as well as the bursting of the tech bubble. Therefore, while the financial crisis was a deeper and larger crisis than the FTSE 100 had perhaps ever seen before, the index ultimately recovered within a matter of years.This highlights the cyclicality of the index, and why it can pay to buy large-cap shares while they trade on low valuations. They can provide you with a more favourable risk/reward ratio which ultimately leads to higher returns in the long run.FTSE 100 outlookWhile buying shares today may not seem as risky as it did a decade ago, a number of challenges could be ahead for investors. They include the ongoing trade war between the US and China, Brexit negotiations and geopolitical risks in the Middle East. Any one of these risks, as well as a range of other threats, could derail the FTSE 100’s current bull run.As such, investors seem to have factored in many of the risks faced by the index. It offers a dividend yield in excess of 4% despite experiencing strong growth since its post-financial crisis lows, while many of the index’s members trade on lower valuations than their historic averages. This may mean that now is a good time to buy a tracker fund, with the index offering long-term growth potential.Beating the marketFor investors who wish to try and beat the FTSE 100’s performance, a number of sectors such as banking, retail, industrials and energy appear to offer wide margins of safety. Buying high-quality companies at low prices could enable you to generate even higher returns than the index in the long run. With it being cheaper than ever to build a diverse portfolio and the index appearing to offer good value for money, now could be a good time to buy stocks – just as it was a decade ago. Enter Your Email Address See all posts by Peter Stephens Simply click below to discover how you can take advantage of this. Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge!last_img read more