The UK’s benchmark FTSE 100 continues to be outperformed by midcaps continuing a trend that has been in place for most of 2021.

Based on current index levels, the FTSE 250 - often seen a better indicator of the UK’s economic health over its FTSE 100 peer - has rallied more than 10% so far this year, outstripping the FTSE 100 by around 10% in relative terms.

Extending the timeframe to a year, midcaps have returned more than twice that of the blue-chips, excluding dividends, with the FTSE 250 31.7% versus the 14.8% gain of the FTSE 100.

FTSE 100 v FTSE 250
	Current level	Year to date	One year
FTSE 100	7,087	9.6%	14.8%
FTSE 250	22,562	10.1%	31.7%
Source: Refinitiv

The nature of the UK recovery, which is currently favouring small-and-medium sized companies, appears to be a key factor.

Reopening trade stocks have shone, with Frankie & Benny's chain operator Restaurant Group (RTN) the second best midcap performer so far this year, chalking-up gains of 103.6%. Outsourcer Mitie (MTO) is a likely winner from major Government infrastructure spending, hence its 65.4% 2021 rally.

Yet there have midcap strugglers too, not least online ticket booking service Trainline (TRN), which is facing an existential threat from the Government’s plans to centralise large parts of the UK’s rail network under public ownership.

---