A lot has been made of the fact that the UK benchmark FTSE100 has retaken the highs last seen at the end of 1999, and the beginning of 2000 when it last traded at 6,950. While it has been a long time coming, this particular UK benchmark has been a serial underperformer over the last two years finding itself eclipsed by the Dow Jones and the S&P500 by quite some distance, as well as the German DAX, which have spent the best part of the last twelve months swapping all-time highs on a fairly regular basis. UK trackers in particular will have found the performance of the FTSE100 particularly disappointing when compared to other indices, but it is also important not to be too fixated on this either. For a start the DAX is a total return index which includes dividend reinvestment and as such it therefore isn’t too surprising that it is at all-time highs. When you judge the FTSE100 by similar parameters it too is at all-time highs, and actually made fresh all-time highs in October 2007, before seeing those highs surpassed again in July 2011, and then on a quarterly basis since the beginning of 2013. The fact is the FTSE100 is not really a UK centric index given how heavily weighted it is to big basic resource stocks, like miners and oil companies, while the bad publicity surrounding banks is not helping it either. The index weightings for the following sectors shows how much of a skew there is, with oil and gas, accounting for 14.49%, comprising 5 stocks, banks - 12.67%, also comprising 5 stocks, pharmaceuticals, comprising 3 stocks at 9.16%, and mining, 7 stocks and 7.48%, which means that 20 stocks make up nearly 44% of the total market cap of the FTSE100. The main drag on the FTSE100 has predominantly been weaker commodity prices, particularly gold copper and crude oil, while banking stocks have also underperformed, due to lower trading volumes, lower margins and increased regulatory concerns. Given these facts, maybe it isn't so surprising that the FTSE100 is finding upside progress a lot harder than its peers, and while investors might be fixated on the 7,000 level they could be missing a trick in not looking at the FTSE250, which has blown the FTSE100 into the weeds, and could be set for a look at the 20,000 level, particularly when you consider that we are getting further monetary stimulus, starting next week from the European Central Bank. That’s not too shabby when you consider the FTSE250 was down at 4,000 at the turn of the century. This would suggest that the FTSE250 is a much better barometer of UK investor sentiment, given that it has outperformed the FTSE100 consistently over the past 15 years, and the reason for this is probably largely due to some reluctance on the part of UK investors to invest in companies that are more to familiar to them, like household names Home Retail Group owner Argos, Dominos Pizza, or pub chains like JD Wetherspoon, who have spent more time in the mid cap index than the benchmark index. Companies like BHP Billiton, Tullow Oil, Rio Tinto, Fresnillo and Glencore may be big global beasts but they don’t really do any business here in the UK, and as such could be perceived to be less accountable to small shareholders. In the FTSE250 there is no heavy bias towards a particular sector and as such the index is therefore less susceptible to the overall business cycle. Even in the panic of 2009 the FTSE250 index never got remotely close to its 2002 lows, in the same way the FTSE100 did, and took out its turn of the century peaks of 7,167 in the run up to its 2007 peaks of 12,282. It then took out these 2007 peaks at the beginning of 2013 and has been tracking higher ever since to be trading well above 17,000, and reinforcing the premise that it’s probably best to invest in what you know, or are familiar with on a day to day basis, rather than getting caught up with headline benchmarks that can be heavily weighted towards particular sectors. For example, over a five year period some of the best performing FTSE250 shares have included clothing retailer Ted Baker, up 456%, supplier to builders, Howden Joinery Group, up 428%, and estate agent RightMove, up 342%. On the downside the worst performers have been Lonmin, Vedanta Resources and Cairn Energy, all down over 70%, all basic resource stocks. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.