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The S&P 500 consists of 500 of the most important US firms, together with Nvidia, Apple, and Tesla. The FTSE 100 consists of 100 of the UK’s largest firms, together with Shell, AstraZeneca, and HSBC.
Which index is best? The place ought to traders look to develop their wealth? Which nation is prone to supply one of the best returns on funding within the years forward? The reply is clear, isn’t it? Or is it?
Exceptions
A typical viewpoint on this within the 12 months 2026 is: sure, the S&P 500 is high canine. That is primarily based on the dynamism of the US financial system, a smorgasbord of thrilling tech companies, a beneficial enterprise atmosphere, and different components. In lots of eyes, the S&P 500 is the embodiment of American exceptionalism.
Information backs this up. Proponents level to 10%-11% yearly returns stretching again over a century. The final 10 years have been significantly fruitful with 16% common returns for the S&P 500!
Aye, there’s the rub. The 12 months 2016 marked a robust divergence in fortunes between the 2 indexes. The first purpose being the rise and rise of tech. The S&P 500 has the world’s largest and brightest tech companies. The FTSE 100 has hardly something by comparability.
What about earlier than that? Curiously, the FTSE 100 was performing higher within the early elements of this century. A £10,000 stake within the S&P 500 could be price £16,000 by the 12 months 2014. The identical stake within the FTSE 100 could be price £17,000.
The unique query then. Is the S&P 500 that a lot better than the FTSE 100? Maybe, nevertheless it’s solely the final 10 years the place there was a critical distinction.
In fact, we will’t know whether or not the longer term will likely be higher for the S&P 500 or the FTSE 100 any greater than whether or not England will ever once more win an Ashes collection in Australia. That’s why I plan to get one of the best of each worlds – by investing in each.
One to contemplate
With the rise of contemporary banking and investing apps, I can spend money on shares from the US, UK, and different international locations all from my iPhone. I may even spend money on the maker of stated digital gadget Apple (NASDAQ: AAPL).
The recognition of iPhones, iPads, MacBooks, and different units propelled Apple to being the second-biggest firm on the earth. It has additionally been within the vanguard of the S&P 500’s wonderful efficiency within the final decade.
Whereas the {hardware} is great, I believe one purpose the corporate might proceed to excel is on the software program aspect. Relating to working techniques for smartphones or computer systems, nobody else comes shut, for my cash.
That’s to not say Apple will all the time rule the roost. For one, the most recent iOS launch induced some controversy with customers complaining that it prioritised ‘kind over operate’. The agency’s $3,500 VR headset – the Apple Imaginative and prescient Professional – appears to be like like it’s going to find yourself a flop too. Maybe that’s an indication the modern spark is not current.
To sum up? It’s not possible to say whether or not know-how and the S&P 500 will proceed to dominate. But when it does, I count on Apple shares to do very nicely. I’d say they’re price contemplating.
