During the latest market wobble, the FTSE 100 briefly returned to levels it had first reached in 1999. The index’s long struggle has been ascribed to its heavyweight financial and resource stocks. Both sectors have done poorly thanks to the banking crisis and the end of the commodities supercycle. In truth, says Lex in the Financial Times, it was the tech bubble that did the damage. In 1999, Vodafone was worth £215bn; it is only a quarter of that sum now.
In any case, the index only measures prices. If you’d held it since 1999 and reinvested all your dividends, your money would have increased by a factor of 2.5, as the progress of the FTSE Total Return index shows.