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The FTSE 100 index of stocks is home to some of the best companies in the world. Through its exposure to many different sectors and parts of the globe, investors can build a high-performing portfolio using just UK blue-chip shares.
In the last decade, the FTSE 100 has delivered an excellent average annual return of 9.2%. That includes both capital gains and dividends. To put that into context, a £20,000 ISA investment in a tracker fund would have turned into £50,010.
Should you buy BAE Systems shares today?
Before you decide, please take a moment to review this report first. Despite ongoing uncertainties from Trump’s 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.
That’s why this could be an ideal time to secure this valuable research – Mark’s analysts have scoured the markets to reveal 5 of his favourite long-term ‘Buys’. Please, don’t make any big decisions before seeing them.
But what about if investors had bought individual FTSE shares instead? Results will vary, with some underperforming the benchmark and others delivering superior returns. So which UK shares have surpassed the index?
Here are two that have, and that I’m confident will continue delivering spectacular returns.
Fantastic returns
Games Workshop (LSE:GAW) is one of the London stock market’s greatest success stories. It wasn’t even in the Footsie index 10 years ago, having been promoted from the FTSE 250 in December 2024.
So what’s behind the company’s success? Surging interest in fantasy tabletop gaming among hobbyists, and its leading position in the market. Warhammer is the industry’s gold standard, and commands a large and loyal fanbase across the globe. Sales have risen roughly 50% in the last five years alone. This has helped the stock deliver an average annual return of 46.9% since May 2016.
Can Games Workshop shares keep rising, though, as market competition increases? I’m confident they can, helped by the company’s plan to accelerate licensing activity with film and TV providers like Amazon. The best-selling Warhammer 40,000: Space Marine video game franchise illustrates how IP licensing can generate enormous royalties and stimulate sales of its miniatures.
Another FTSE 100 high flyer
BAE Systems (LSE:BA.) plays a vital role in Western defence. So as geopolitical instability has risen, and major wars in Europe and the Middle East have broken out, demand for its hardware has soared.
As a consequence, the company’s delivered an average annual return of 17.3% over 10 years. That’s approaching double what the broader FTSE 100 has provided. In that time, sales have rocketed and latest financials showed its order backlog at a record £83.6bn.
Can BAE shares keep up the pace, though? It may have some hiccups if supply chain issues worsen due to the Iran war, pushing up costs and hampering project delivery. But in this changing global landscape, I think there’s significant scope for further share price gains as defence budgets keep rising. As a critical supplier to multiple major NATO members, BAE’s in a stronger position than most to capitalise on this.
Generating ISA wealth
Past performance isn’t always a reliable guide to future returns. But, as I say, I’m confident Games Workshop and BAE Systems shares can keep on delivering for ISA investors like myself.
If they can replicate the returns they’ve delivered since May 2016, these FTSE 100 stocks will have turned £20,000 equally invested across them into £541,834 a decade from now.
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