FTSE 100 High-FCF 25
Twenty-five FTSE 100 names with FCF yield above 7% and buyback yield above 3%, weighted by combined shareholder yield.
Why it won
The FTSE 100 is the most-shorted income index in developed markets and the easiest place to find double-digit shareholder yields. This thesis ignores the headline dividend yield and screens for the names actually returning cash via buybacks plus dividends, which is a far cleaner signal in a UK market that has been quietly buying back stock for three years.
The prompt
FTSE 100 constituents with FCF yield above 7% and buyback yield above 3%. 25 names, weighted by combined buyback plus dividend yield, capped at 8% per name. Rebalance every six months.
Methodology
- Universe: current FTSE 100 constituents only.
- Screen: trailing 12m FCF yield above 7% AND buyback yield above 3%.
- Quality filter: net debt to EBITDA below 3x to exclude balance-sheet rollups.
- Weight by combined buyback plus dividend yield, capped at 8% per name.
- Semi-annual rebalance in March and September, aligned to LSE results season.
Backtest
Figures are illustrative for editorial purposes. Past performance does not guarantee future results.
Holdings
| Ticker | Name | Weight |
|---|---|---|
| SHEL.L | Shell plc | 8.0% |
| BP.L | BP plc | 8.0% |
| AZN.L | AstraZeneca | 6.0% |
| GSK.L | GSK plc | 5.0% |
| HSBA.L | HSBC Holdings | 7.0% |
| BARC.L | Barclays | 6.0% |
| LLOY.L | Lloyds Banking Group | 5.0% |
| NWG.L | NatWest Group | 5.0% |
| STAN.L | Standard Chartered | 4.0% |
| AAL.L | Anglo American | 3.0% |
| RIO.L | Rio Tinto | 4.0% |
| GLEN.L | Glencore | 4.0% |
| BATS.L | British American Tobacco | 5.0% |
| IMB.L | Imperial Brands | 4.0% |
| ULVR.L | Unilever | 3.0% |
| DGE.L | Diageo | 2.0% |
| RKT.L | Reckitt Benckiser | 2.0% |
| PRU.L | Prudential plc | 2.0% |
| LGEN.L | Legal & General | 3.0% |
| AV.L | Aviva | 3.0% |
| PHNX.L | Phoenix Group | 2.0% |
| BT-A.L | BT Group | 2.0% |
| VOD.L | Vodafone Group | 2.0% |
| REL.L | RELX plc | 3.0% |
| NG.L | National Grid | 2.0% |
Risks
- Heavy financials and energy weighting means the index is structurally cyclical.
- BP and Shell account for 16% combined, so an oil price shock dominates short-term performance.
- Tobacco exposure is uncomfortable for many UK mandates and will need an ex-tobacco variant.
Earlier weeks
Thirty global compounders with ROIC above 20% and zero exposure to the Magnificent Seven, on a 5-year backtest that quietly clears SPY.
Twenty defence and aerospace names with no exposure to cluster munitions, nuclear delivery systems or anti-personnel mines, weighted by 3-year backlog growth.
The 25-year dividend-growth list with tobacco names dropped and the savings redistributed by FCF coverage, not yield.
