Oil firms, food and drink retailers and telecom companies are the UK businesses that are expected to deliver the strongest returns as chastened investors say farewell to the ‘Noughties', according to Barclays Wealth.

BP, Royal Dutch Shell, Vodafone, BATS and Diageo are among the top-ten expected performers for the next 10 years, predicts Henk Potts, equity strategist at the UK wealth manager. He argues that these firms all benefit from brand strength, initial yield, market dominance and growing markets for their wares. These companies make up a large weighting on the UK's flagship stock market index.

However, as Barclays Wealth pointed out, large-caps have generally performed miserably compared with mid-size and small-cap stocks during the period since the turn of the Millennium.

For example, the total returns on the FTSE 100 – including dividends – were just 9.5 per cent in the past decade, compared with 90 per cent for the FTSE 250 Index of mid-cap stocks, Barclays Wealth said, citing Thomson Datastream and Factset data.

Out of companies that were constituents of the FTSE 100 at the beginning of the decade and remain publicly quoted today, British American Tobacco generated a 880 per cent return including dividends; while Colt Telecom lost 99 per cent, Barclays Wealth said in a briefing note as 2009 drew to a close.

“British investors could be forgiven for tiring of investing in equities, as the performance of the UK’s flagship index, the FTSE 100, has been pretty dismal over the last decade.  In fact, the FTSE 100 was entering the Noughties as it reached its all time high a decade ago on 31 December 1999, when it closed at 6930.20 points, compared to 5437 as of close on 29th December,” the firm said.

Within the FTSE 100’s constituent firms, the top performer for the Noughties was British American Tobacco, with a total return of 880 per cent – a result that demonstrates that ethical investment funds which exclude tobacco stocks may pass up on such high returns as a cost of their stance. Imperial Tobacco made returns of 658 per cent. Reckitt Benckiser Group achieved 645 per cent returns, while BHP Billiton, the mining group, chalked up returns of 668 pert cent, and BG Group, at 382 per cent.