Britain’s largest companies are international players. The 100 stocks in the FTSE 100 operate on a global basis, drawing 70% of their revenues from outside of the UK. For many investors too wary to invest directly in emerging markets, buying FTSE 100 listed stocks can offer access to the emerging markets growth story, but with the comfort of a level of corporate governance and transparent shareholder dealings that are upheld in developed markets.
Income continues to be the main concern for investors in the UK – both in the run up to retirement, where dividends reinvested can significantly boost total returns, and for those that have already started drawing on their pension dividends can help supplement their post-retirement income.
FTSE 100 stocks may not offer the same potential for growth as their smaller counterparts, but broadly speaking the dividends paid by these megacaps are more secure than those paid by small and medium sized companies.