The UK market has been unloved with investors in recent years, while the US has dominated market returns.
However, sentiment seems to be shifting.
The FTSE 100 (the UK’s 100 largest companies) has hit another new record, just after recently surpassing 9,000 for the first time.
The UK’s most well-known index has risen an impressive 12.66% so far in 2025 and performed better than other major stock markets like the US, which has risen 0.54% (in pound sterling terms). (Source: Lipper IM to 21/07/2025).
This article isn’t personal advice. If you're not sure if a course of action is right for you, ask for financial advice. Remember, all investments can rise and fall in value, so you could get back less than you invest. Past performance also isn’t a guide to the future.
Why is the FTSE 100 rising?
Sectors like aerospace & defence and banks have boosted the returns of the FTSE 100 this year.
Aerospace & defence companies, like Rolls-Royce and BAE Systems, have performed strongly driven by the UK’s commitment to increase defence spending.
Banks have done well too as they’ve benefited from higher interest rates.
Despite ongoing trade tensions around the world, the UK was the first country to agree a trade deal with the US and benefit from reduced tariffs.
Rachel Reeves has also announced reforms which aim to increase investment in the stock market and drive growth across the UK.
This has all been positive for the UK market and driven the FTSE 100 to record levels.
How can you invest in the UK stock market?
Investing in index tracker funds is a simple and low-cost way to track the performance of a benchmark, like the FTSE 100, rather than try and beat it like active funds do.
If you’re looking to invest in the FTSE 100, here are two passive funds that offer you a way to track the UK stock market.
Both funds are managed by Legal & General, which is one of the largest providers of index funds in the UK – they’ve run index tracker funds for over 30 years.
Investors should note that both funds invest in companies that are involved with the extraction of oil, gas or coal, which adds risk.
Investing in these funds isn’t right for everyone. Investors should only invest if the fund’s objectives are aligned with their own, and there’s a specific need for the type of investment being made. Investors should understand the specific risks of a fund before they invest, and make sure any new investment forms part of a diversified portfolio.
For more details on each fund including its charges and risks, use the links to their factsheets and key investor information.
Legal & General UK 100 Index
The fund invests in the 100 largest companies in the UK by tracking the FTSE 100.
While it’s a UK index, many of the companies also earn money from selling their goods and services overseas. Investors will therefore be indirectly investing into foreign economies as well as the UK.
We think this fund could be a good addition to a more global investment portfolio, or could diversify a portfolio focused on smaller companies or other investments, like bonds.
Legal & General UK Index
This fund provides investors with broad exposure to the UK market. It tracks the FTSE All-Share Index, which includes the largest 100 as well as another 450 companies.
The companies in the index vary in terms of their size and the sectors in which they operate. Investments in medium-sized and smaller companies increases risk.
A broad UK tracker fund could help diversify an investment portfolio that is focused on other regions like the US or Asia.
Annual percentage growth
Jun 20 – Jun 21 | Jun 21 – Jun 22 | Jun 22 – Jun 23 | Jun 23 – Jun 24 | Jun 24 – Jun 25 | |
|---|---|---|---|---|---|
Legal & General UK 100 Index | 16.47% | 5.80% | 8.70% | 13.58% | 10.89% |
FTSE 100 | 18.01% | 5.76% | 9.15% | 12.79% | 11.30% |
Legal & General UK Index | 20.01% | 1.72% | 7.65% | 13.81% | 10.80% |
FTSE All-Share | 21.45% | 1.64% | 7.89% | 12.98% | 11.16% |
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