Yet if someone had parked £10k in the index at the beginning of 2020, what would it look like right now?

Show me the numbers!

At the start of January 2020, the index was trading at 7,604 points. Over the period, it traded to a low of 4,993 points during the pandemic crash in 2020, with a high of 10,910 points in February. A £10k investment would be worth £13,668 at the moment, given the gain of almost 37% from the start of 2020.

On the face of it, that seems like a good return. To be clear, no one should be unhappy with a profit! However, it isn’t as good as some might expect. Across the pond, the S&P 500 has delivered a 120% return over the same period.

At a stock-specific level, some constituents have vastly outperformed. Rolls-Royce is a good example, gaining 389% during the period in question. Of course, some stocks have lost significant value over the years as well. So things do need to be taken with a pinch of salt. But on the whole, I think an active investor with a carefully-selected stock portfolio could have outperformed the index in these years.

Where to from here?

The past is only half of the discussion. Where the index goes from here is equally worthy of conversation. Given the market’s ability to recover and shrug off the impact of the events in recent years, I believe that over a long enough timeline, the index can continue to deliver positive returns in the coming years.

However, I think an investor could target specific sectors that are poised to grow faster than average. For example, FinTech. IG Group (LSE:IGG) slots into this category nicely as a FTSE 100 growth stock.

It enables clients to trade and speculate on the price movements of shares, currencies, and commodities. In simple terms, when clients trade more, IG earns more through fees, spreads, and financing charges. It’s grown rapidly since 2020, in part due to higher market volatility. I can only see this continuing in the years ahead, so that’s one tick in the box for the outlook.

Add to this the fact that it’s pursuing an expansion-focused strategy. This includes acquisitions like Freetrade and moves into crypto. There’s a clear attempt to diversify beyond just a standard brokerage offer. However, there are risks. Regulation is the elephant in the room. IG’s core products are leveraged and high-risk, meaning regulators are constantly watching. Any tightening of rules around retail trading could hit growth.

Even with this, I still believe it has a strong shot of outperforming the broader index in the coming years and therefore could be considered by investors.

The post £10k invested in the FTSE 100 at the start of the decade is now worth… appeared first on The Twelfth Magpie.

While the average FTSE 100 P/E is just over 16 today, these two growth stocks are valued at less than half that. With time and compounding, they could help power a stock portfolio towards millionaire territory. The average Stocks and Shares ISA has grown by 9.5% a year over the last decade. At that rate, somebody who invested their full £20k limit would have £1.18m after 20 years. Ready to go on a bargain hunt?

Just look at these low P/Es!

Lion Finance Group (LSE: BGEO) is a stunner. It shares are up an eye-popping 980% in the last five years, a performance topped only by Rolls-Royce. But while Rolls is a household name, this one has flown under the radar. Lion Finance only rebranded from Bank of Georgia in 2025, and powered into the FTSE 100 in March. Since then, its shares have maintained their blistering momentum. They’re up 90% over one year, and 20% in the last turbulent month. Can this continue?

Despite that stellar return, Lion’s P/E ratio remains a bargain-priced 6.8. So how come it’s still such a bargain? It’s all down to that four-letter word – risk. Today, it’s focused on two eastern European countries, Georgia and Armenia. Both are in a volatile part of the world. Georgian capital Tbilisi saw mass protests over electoral fraud in 2024.

Lion has a brilliant expansion opportunity but the political backdrop means things could get bumpy at times. So should investors consider buying it? I think it’s a thrilling momentum play, but only for the brave.

Another great value growth stock

I’m sticking with the financial sector for my next value play, online trading platform IG Group Holdings (LSE: IGG). Its shares are still up 60% over five years, and 42% over the last 12 months.

IG offers spread betting, contracts for difference and share dealing services to retail and institutional investors. It tends to do well when markets are volatile, as this drives trading volumes and revenues. Unsurprisingly, it’s been doing well lately. In 2025, IG posted a 15% rise in pre-tax profit to £564m. It had juicy EBITDA operating margins of 47.3% and rewarded investors with a £125m share buyback.

How brave do investors have to be?

Yet IG Group still boasts a really low P/E of just 6.9. The rising share price has reduced the trailing yield, but it’s still a solid 3.1%. So what are the risks? IG Group can have lean times too. While it’s doing well in today’s uncertain markets, it won’t do as well when they finally calm down. Also, spread batting is risky, and there’s a lot of customer churn, as new hopefuls give it a shot, then back out once the losses rack up.

I think both shares offer compelling income and growth opportunities, at a brilliant price. Well worth a closer look, for ISA investors who are up for the challenge.

The post 2 stupidly cheap shares to consider buying now to try and make a million appeared first on The Twelfth Magpie.

Is this a sign for investors to consider buying more? Or is now the time to be cautious? Let’s look at two examples.

Top performer

Fantasy figurine maker Games Workshop (LSE: GAW) has been one of the best investments of the last decade. Had anyone put £5,000 to work in the stock in April 2016, they’d now be sitting on a stake worth over £200,000! And that’s not even factoring dividends into the mix.

Yes, there’s been a bit of volatility along the way. The shares pretty much halved in value as inflation raged in 2022 following the pandemic. But investors quickly returned, lured by a great growth story and astonishing fundamentals.

In January this year, the company dropped another excellent set of half-year numbers. Revenue rose 10.9% while core operating profit hit £126.1m.

Is it now too expensive?

The only issue with all this is that the shares are now very expensive. To some extent, this is justified considering how big its margins are. Boasting a lovely amount of net cash, the balance sheet is a thing of beauty too.

Tellingly, there’s also been a lot of director buying over the years. If those most aware of how the company is faring are willing to put their own money to work, that’s usually a very good sign.

Even so, a price-to-earnings (P/E) ratio of 35 for the current financial year is looking a bit frothy. The risk here is that expectations will exceed reality and any slight disappointment — such as earnings meeting rather than exceeding forecasts — will lead to a sell-off.

This is a brilliant business that commands huge loyalty from fans. But I wonder if the best time to load up is when markets next crash. No one knows when this will come, of course. But we can be pretty sure there will be opportunities ahead.

Record numbers

IG Group (LSE: IGG) has been another winner for investors, albeit not to the same extent. It’s climbed 45% in value in the last 12 months alone and also sits at an all-time high.

This is all pretty impressive considering the company has traditionally had more appeal for income investors than those looking for share price growth.

IG’s surge isn’t a mystery. Back in March, it posted record annual revenue. The launch of a strategic review that could include acquisitions and industry tie-ups also got investors excited.

Apples and oranges?

But there are a few notable differences. While Games Workshop is dominant in its niche, the £5bn cap operates in very competitive space. IG Group often faces regulatory pressure but Games Workshop is devoid of such scrutiny.

This partly explains why shares in the online trading platform provider change hands at a P/E of 13. That’s a lot cheaper than the aforementioned FTSE 100 stock, even though it boasts similarly great margins.

Still, there’s no reason why IG Group can’t continue ascending. Momentum is a powerful force in investing. Importantly, IG also makes more money when markets get jittery than when all feels rosy, potentially giving owners a nice hedge.

Of the two, I think this one warrants more consideration.

The post Investors can’t stop buying these UK shares appeared first on The Twelfth Magpie.

Half a dozen stocks jumped by around 10%, with only a handful ending the day in the red. That’s good news for existing portfolios, but investors waiting to snap up bargains may have mixed feelings. The good news is there are still plenty of great value shares around, measured by their price-to-earnings ratios.

The P/E ratio measures a company’s share price against its earnings, showing how much investors are paying for each £1 of profit. A low P/E can signal value, but may also reflect weak growth prospects or underlying risks. It’s not a surefire guarantee of a bargain.

Blue-chip bargains galore!

Incredibly, two FTSE 100 stocks trade on fractional P/Es. Insurer Legal & General Group, which yields an eye-catching 8.4%, has a P/E of just 0.3, while consumer goods giant Reckitt trades at 0.6. I’ve looked at both recently for The Motley Fool and concluded that while they have issues, they’re still worth considering today.

I’ve also highlighted sportswear retailer JD Sports Fashion. Its shares have taken a battering as squeezed consumers cut spending and sales struggle across the UK, Europe, and the US. A quick recovery looks unlikely, especially with inflation still stubborn. If artificial intelligence hits employment for younger shoppers, a key customer base, JD Sports may face further pressure.

I own Legal & General and JD Sports in my SIPP, alongside another value stock, British Airways-owner International Consolidated Airlines Group. I’ve done well out of IAG, but the shares have been bumpy since Middle East tensions exploded. Concerns over flight hub closures and rising fuel costs have all hit the shares. With its low P/E of 6.8, I still think IAG is worth considering for the long term, but this is a volatile sector and not for the faint-hearted.

IG Group looks good value

The final cheap stock on my list is one I haven’t covered for a while, trading platform IG Group Holdings (LSE: IGG). I thought it looked a bargain a few years ago but never bought in. Shame. The shares have doubled over the last two years and are up around 55% over 12 months. IG shot into the FTSE 100 in March 2026.

IG operates in online trading and investment platforms, offering spread betting, contracts for difference, and share dealing services to retail and institutional investors. It tends to benefit when markets are volatile, as higher activity drives trading volumes.

In 2025, IG posted a 7% rise in revenue to £1.1bn, with pre-tax profit up 15% to £564m. It also announced a £125m share buyback, reflecting strong performance and growth in client numbers.

Today’s volatility is likely to play into its hands, yet it still looks good value with a P/E of 6.9. The yield has slipped to 3.25% after the share price surge, but it remains attractive. I already hold plenty of financial stocks, so I probably shouldn’t buy this one myself. Otherwise, I think it’s well worth considering.

So there are still genuine bargains out there. With volatility likely to continue as the ceasefire is tested, more opportunities may yet emerge.

The post P/Es below 7! 3 staggeringly cheap shares despite yesterday’s rally appeared first on The Twelfth Magpie.

Benefitting from volatility

First up is IG Group (LSE:IGG). This stock’s already up 11% this year, with much of that driven by investor sentiment about bumper future earnings amid recent market volatility. After all, IG’s main source of revenue is fees and commissions from users trading on the platform. So during the recent weeks of stocks swinging higher and lower, not to mention commodities and other assets, I expect client activity has picked up significantly.

Even though volatility’s only been evident for a month or so, I think some investors are buying the stock almost as a form of protection against the risks of a longer-term conflict in the Middle East. If the situation doesn’t improve in the coming months, it could weigh on the stock market, but companies like IG Group could become defensive stocks that outperform in this environment.

Over the past year, the stock’s risen by 52%. Yet when I look forward, the sharp rally still only means the price-to-earnings ratio is 7.39. This is less than half the FTSE 100 average ratio, suggesting the stock could be undervalued. At the very least, it appears better value than Rolls-Royce.

In terms of risks, regulatory concern is up there. IG operates in leveraged products and services retail clients, which regulators are very strict on. Yet even with this, I think the outlook could support further gains.

Turning to emerging markets

Another option is Ninety One (LSE:N91). Up 10% in 2026 and 61% over the past year, the emerging markets asset manager is enjoying a strong inflow of client funds. In a January trading update, it noted assets under management (AUM) hit £159.8bn as of the end of 2025, up from £130.2bn the year before.

Demand for emerging market investments has risen over the past year, with lower interest rates in developed markets pushing investors to other areas in the hunt for yield. Further, the spike in energy prices in 2026 has helped many of these nations, given their net export nature of products like oil and gas.

Ninety One isn’t just being passive in its strategy either. Its new Sanlam partnership is a big deal as it gives access to a large South African client base with a steady pipeline of assets. This should help to boost the outlook going forward.

It’s true that one good year doesn’t mark a structural trend higher for the company. Emerging markets are notoriously volatile, meaning that investors could swiftly pull their money back out if things turn sour. But overall, I think it’s another growth share that looks more attractive than Rolls-Royce.

The post 2 growth shares beating Rolls-Royce stock so far this year appeared first on The Twelfth Magpie.

Interested in learning more? Here’s a look at two of these stocks.

Rising while the market is falling

One group of companies that often does well when market volatility picks up is financial trading businesses. The reason they tend to outperform is that volatility creates trading opportunities – when markets are swinging around wildly, customers want to place more trades.

Now, one of my favourite UK stocks in this space is IG Group (LSE: IGG). I’ve highlighted this name a few times recently as an undervalued growth (and income) play.

It’s having a great run at the moment. This week, it actually hit new all-time highs.

Relative to the FTSE 100 (which it’s set to join at the end of this month), it’s outperforming by a wide margin. Over a month, it’s up about 6% versus a 6% fall for the index.

Even near all-time highs, I still see a lot of appeal in the stock. Because it still looks relatively cheap (the forward-looking price-to-earnings ratio is only 12) and offers an attractive dividend yield (3.1%).

Meanwhile, the company is performing well and just announced a strategic review to ensure it captures the full long-term opportunity ahead. “We operate in large and fast-growing markets being reshaped by structural drivers, and now is the time to raise our ambitions,” said the firm in an update.

It’s worth pointing out that IG operates in a competitive market. Players it’s up against include the likes of Robinhood and Trading 212.

It seems to be holding its own amid the growing level of competition, however. So, I think it’s worth considering for a portfolio.

Near 52-week highs despite market weakness

Another company in this industry that could be worth a look though is CMC Markets (LSE: CMCX). It offers similar services to IG but is significantly smaller (it’s in the FTSE 250 index).

It’s not at all-time highs at the moment. But it is near 52-week highs, meaning that pretty much everyone who bought shares in the last year is now in positive territory.

I see a lot of appeal in this name too. Like IG, it’s cheap (the P/E ratio is 11.5) and sports an attractive yield (4.4%).

It also has momentum at the moment. Recently, it has done some major white label deals that could massively boost growth (one of these was with Australian banking giant Westpac).

Again, competition is a risk. These days, traders and investors have a lot of choice when it comes to platforms.

With a below-market-average valuation and an above-average yield, however, I like the risk/reward proposition. In my view, this stock is worth a closer look right now.

The post As the FTSE indexes sink, these unique dividend shares are making investors money appeared first on The Twelfth Magpie.

Riding the wave

I’m talking about IG Group (LSE:IGG). The financial services company has a market cap of £4.65bn, with some FTSE 100 peers having a market cap of £1bn less. This makes it likely to get the nod next month, providing nothing crazy happens in the next few weeks.

The rise in market cap has been driven by a 39% surge in the share price over the past year. Some 24% of that gain occurred in the past three months.

It has done well on the back of new customer account growth and higher client trading activity. This doesn’t surprise me, given the volatility we’ve seen in the stock market over the past year. Given that IG makes money from each transaction, the higher frequency of client trading is a good thing.

This has filtered down to both higher profits and raised guidance for the future. For example, back in late November, a trading update detailed that “the company is accelerating its guidance, now expecting to achieve revenue growth around the mid-point of its mid-to-high single-digit target in calendar year 2026”. It went further, saying it’s “confident in meeting market expectations for EBITDA”.

Continued growth potential

A promotion to the FTSE 100 could help the company further, as it brings a lot more eyeballs on the business. Further, FTSE 100 tracker funds would buy the stock. Even though FTSE 250 trackers would sell it, the net impact would be positive, as there’s more volume and interest in FTSE 100 trackers.

Beyond this potential bump, there are several reasons why I think the stock could do well further down the line. It has recently secured new product licenses in the UK and EU. This gives it a much broader scope to dive into new asset classes.

Another factor is the price-to-earnings ratio. At 12.11, it’s well below the FTSE 100 average of 18. This could make it undervalued, even with the recent price boost. Even if earnings per share don’t increase, the stock could rally before it looks overvalued.

No such thing as a free lunch

In terms of risks, there’s always a regulatory concern with some of the products offered. The use of leverage by retail investors can amplify losses, and tightening policies on the provision of such services could reduce revenue for IG.

Even with this, I think the stock looks attractive and could be considered by investors ahead of any potential inclusion to the FTSE 100.

The post This FTSE 250 share is my early pick to get promoted to the FTSE 100 next month! appeared first on The Twelfth Magpie.

Within the index, though, some companies naturally stand to benefit more than others. And a couple in particular have caught my attention over the last few days.

Greggs

It’s hard to think of a company more exposed to UK consumer spending than Greggs (LSE:GRG). The stock has crashed in the last 12 months, but it bounced after the Budget.

The hope is that increases to the national minimum wage might give consumers a bit more disposable income. And that should help revive some really poor like-for-like sales numbers. 

Weak consumer sentiment, though, isn’t one thing that has been ailing the company. The firm’s management has attributed the faltering results to various weather conditions. 

If they’re right, that could be an ongoing problem. There isn’t really anything the company can do about this and it’s not going to be sorted out in any Budget, either.

My suspicion, though, is that weather will somehow start to matter less if consumer spending improves. And this might cause the share price to do the same. 

The real issue with the stock, in my view, is that it was grossly overpriced in January relative to its growth prospects. After a 45% decline, though, I think it’s worth considering.

IG Group

There was a lot of speculation before the Budget about what might happen to ISAs. And the resulting reform was an obvious benefit to IG Group (LSE:IGG). 

From April, the Cash ISA annual contribution limit for UK savers under 65 is going to fall to £8,000. So anyone wanting to use the full £20,000 allocation is going to need a Stocks and Shares ISA.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

That’s a good thing for providers like IG Group and it’s therefore no surprise to see the stock climb 10% in response to the news. But the market might have been a bit hasty here.

A couple of things are still unclear, from my perspective. One is whether the proposed moves will be enough to generate a meaningful bump in stock market participation. 

Another is what happens if they are. If UK savers start switching to investing in a meaningful way, there’s a real chance this could attract more competition, especially from larger banks. 

While IG Group does have some unique strengths, more competition wouldn’t be a good thing. So I’m not looking to follow other investors into this one at the moment. 

Budget winners

To my mind, the FTSE 250 is clearly the place to look for winners from the Autumn Budget. And the stock market seems to have decided that both Greggs and IG Group are the ones. 

In both cases, I understand the reasoning – but I’m not convinced. I think Greggs is worth considering, but that’s because of how far it’s fallen this year, not the Budget.

With IG Group, I’m wary that investors might be overestimating the importance of the latest news. In my view, the real winners from the Budget might be elsewhere in the FTSE 250.

The post Were these FTSE 250 stocks the real winners from the Autumn Budget? appeared first on The Twelfth Magpie.

I reckon investors can do better than BT however. With that in mind, here are two shares I believe will outperform the telecoms stock over the next five years.

What’s wrong with BT shares?

At first glance, BT shares appear to have a lot going for them. At 187p, they’re trading on a forward-looking price-to-earnings (P/E) ratio of just 10, so they’re quite cheap. As for the dividend yield, it’s about 4.6%. So there’s potential for a decent level of income here.

Dig deeper however, and things don’t look quite so attractive. Take revenue growth (a key driver of long-term returns), for example – it’s non-existent. As for the balance sheet, it remains loaded with debt. That means interest payments are going to take a chunk out of profits.

Speaking of profitability, this is very low – over the last five years return on capital employed (ROCE) has averaged just 6%. Generally speaking, companies with a high ROCE (eg 15%+) tend to be much better long-term investments than those with low ROCEs.

More growth potential

So what stocks could potentially beat BT over the next five years in my view? Well, one is FTSE 250 stock IG Group (LSE: IGG), a provider of trading and investment platforms.

It trades on roughly the same P/E ratio as BT. The yield’s quite similar too (4.4%).

I see a lot more growth potential here though. Not only should this company benefit from volatile markets in the years ahead (ie more trading activity) but rising markets should boost income from investment management services (note that it owns Freetrade).

It’s also far more profitable. Over the last five years, ROCE has averaged 23%.

A risk here is competition. Today, the trading and investment markets are fiercely competitive and IG’s facing competition from the likes of Robinhood and Trading 212.

I like the risk/reward skew though. In my view, this stock’s worth considering as a long-term investment.

Far more profitable than BT

Another stock with more potential, in my view, is Computacenter (LSE: CCC). It’s a leading provider of IT solutions to public and private organisations.

I reckon this company is really well placed to benefit from the digital transformation trend. It can help organisations with everything from artificial intelligence (AI) to cybersecurity.

Now, this stock’s more expensive than BT. The P/E ratio here is 17.5. As for the yield, it’s lower than BT’s. Currently, it’s about 2.5%.

I wouldn’t be put off by these metrics however. This company’s growing at a much faster rate than BT – over the last five years, revenue’s climbed about 40%. It’s also far more profitable (five-year average ROCE of 25%) and sports a much stronger balance sheet.

Of course, a slowdown in tech spending’s a risk here. This could occur if the economy takes a downturn.

Taking a five-year view though, I’m optimistic this company will see solid growth. I think it’s worth considering as an alternative to BT.

But others here at The Motley Fool could have different opinions…

The post Prediction: these dividend shares will provide higher returns than BT over the next 5 years appeared first on The Twelfth Magpie.

I have no plans to put any actual money on the line. But my exercise will provide a valuable insight into just how well AI can identify credible growth opportunities. As someone who’s still sceptical about the accuracy and rationale of such systems, I’m curious to see whether ChatGPT’s logic holds up in the real world.

My plan is to track the performance of this FTSE 250 mini portfolio. And to make things interesting, I’ll compare the results to a selection of growth stocks I’ve chosen from the UK mid-tier index.

The two portfolios

For this exercise, I’ll be combining share price gains performance along with any dividend income to ascertain the total return of both portfolios.

Here they are:

I have to admit, there are a couple of ChatGPT stocks I might have added to my own portfolio, but I’m much less convinced about the others.

Softcat is a cloud computing and IT infrastructure provider with growth potential as the digital economy booms. Meanwhile, defence business QinetiQ could thrive as NATO countries rapidly rebuild their arsenals.

But reflecting this, I see better opportunities in other stocks. I’ve put the Allianz Technology Trust and countermeasures manufacturer Chemring in my own theoretical portfolio. I’ve also added gold stock Endeavour Mining and TBC Bank, which offers financial services in Western and Central Asia.

A FTSE 100 contender?

I’m pretty excited about IG Group (LSE:IGG), which runs online trading platforms across the globe. I’ve used it to round off my portfolio.

It’s currently in the FTSE 250, but having risen 12% in value in 2025, it’s now knocking on the door for inclusion on the FTSE 100. Its market cap stands at £3.8bn.

IG operates in a highly competitive market, bringing competitive threats from the likes of eToro and CMC Markets. But it enjoys considerable brand recognition, with a strong track record dating back to 1974 that resonates with customers.

As the public’s interest in trading takes off, IG is reaping the benefits. Average active customer numbers rose 3% organically in the August quarter, to 278,900 traders.

The company is rapidly expanding to give its growth prospects a shot in the arm too. In April it acquired UK investment platform Freetrade, and in September agreed to purchase Australian cryptocurrency exchange Independent Reserve. I’m expecting big things from IG over the near term and beyond.

And we’re off!

So our portfolios are now set up and ready to go. Check back soon to see how I’ve fared against the mighty AI machine.

Of course, five stocks don’t make a portfolio. That’s why I’ve got my eye on other exciting opportunities in the FTSE 250 too.

The post I asked ChatGPT for a portfolio of FTSE 250 growth shares to buy. Can I beat it? appeared first on The Twelfth Magpie.