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FTSE 100 shares are up 17% this year. Is it too late to invest?

The FTSE 100 index of leading British blue-chip shares is up by close to a fifth since the start of 2025. Our writer explains what he’s doing about that.

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At the start of 2025, there was no specific reason to expect that the FTSE 100 index of leading British shares would enjoy a rip-roaring year.

Along the way, there have been some causes for concern, not least market reaction to April’s announcement of new US tariff policies.

Should you buy Diageo Plc shares today?

Before you decide, please take a moment to review this report first. Despite ongoing uncertainties from US tariffs to global conflicts, Mark Rogers and his team believe many UK shares still trade at substantial discounts, offering savvy investors plenty of potential opportunities to learn about.

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Still, the blue-chip index has racked up a 17% gain in value so far this year. For an index of large companies, many of them in mature industries, I think that is impressive. Might it still be worth my time investing in the index now, after that gain, for example by buying shares in an index tracker?

Things may continue well

I think it could be, but I do not plan to! I will explain below what I am doing instead. But first, why do I think there could potentially be merit to the idea of me investing in the index even now?

Put simply, I am a believer in long-term investing.

The FTSE 100 index includes many of the country’s biggest companies. From a long-term perspective I am bullish about the outlook for the UK economy and therefore for the index too. In the short-to-medium-term, of course, things could go either way. But I do see an argument for the index to keep rising.

After all, it remains more cheaply valued that its US counterpart. This year’s performance has proven that even a fairly sluggish British economy need not hold the index back.

I’m buying individual shares

Still, there is also a point of view that the 17% gain is hard to justify given the overall economic performance this year — and the outlook for 2026 and beyond.

If the global economy enters a rough patch, I expect that would have a negative impact on the FTSE 100. So instead of investing in an index tracker, I continue to look for individual shares to buy.

One share I’ve been buying this year

Given how well the FTSE 100 has done this year, have all its constituent members also done well?

Certainly not! For example, brewer and distiller Diageo (LSE: DGE) has had a torrid 2025 to date, losing 35% of its value and a chief executive to boot.

There are short-term worries about weak spirits sales in many markets, threatening profits. But there is also a bigger picture concern troubling many investors’ minds: what declining alcohol consumption rates among younger generations could mean for beer and spirits sales.

Sure, Diageo has developed alcohol-free versions of iconic brands like Guinness and Gordon’s, as well as acquiring non-alcoholic brands Seedlip and Ritual Zero Proof (better known to American drinkers than Britons, underlining Diageo’s global reach).

But will that be enough to help sustain revenues and profits, as well as support the dividend? After all, Diageo is one of only a few FTSE 100 members to have grown its dividend per share annually for decades.

I hope it will be enough. With unique brands, a large distribution network and deep relationships in the drinks industry, I am optimistic about Diageo’s outlook.

Indeed, I have added the share to my portfolio this year.

C Ruane has positions in Diageo Plc. The Motley Fool UK has recommended Diageo Plc. 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.

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