The most successful investors use volatility on share markets as an opportunity to buy. They don’t duck for cover when UK shares plummet in value. They use stock market crashes as an opportunity to build top-quality stock portfolios for little cost.
This approach leaves plenty of ammunition for unloved shares to rocket in value as economic conditions and profits improve. Studies show us that stock investors make a delicious average annual return of between 8% and 10% each year over the long run. Buying quality UK shares at low, low prices gives you and I a better chance of hitting, or maybe even exceeding, the upper echelons of this range.
3 of the best UK shares today This is why I believe the 2020 stock market crash provides an excellent buying opportunity. You can follow the herd and sit on your hands. Or you can do some research, buy some brilliantly-valued UK shares and sit back and watch them surge in value over time. This is what I plan to do. And these are some of the great British stocks that are on my watchlist today.
- Amino Technologies is an absolute steal at current prices, I feel. The business trades on a sub-1 forward price-to-earnings growth (PEG) ratio of 0.6 right now because City analysts reckon profits will keep rising by double-digit percentages over the next couple of years at least. Amino provides hardware and software for TV set-top boxes and is thus well placed to ride the explosion in on-demand streaming in the years ahead.
- Vistry Group (formerly known as Bovis Homes (LON:VTYV)) is another cheap UK share I’m thinking of buying today. The housebuilders continue to be shunned on fears of a slump in homes demand. But I see true value here as a litany of factors, from low interest rates, disjointed government homebuilding policy, a mortgage rate war and the Help to Buy purchase scheme should drive new-build demand for years to come. Today Vistry Group trades on a forward price-to-earnings (P/E) ratio of below 10 times.
- FTSE 100 stock Prudential (LON:PRU) offers investors the chance to grab big dividends and low earnings multiples. The insurance colossus also trades on a forward P/E ratio of just under 10 times for 2020. And it has an inflation-beating 3% dividend yield as well. I bought the blue-chip earlier this year because I thought it was one of the best UK shares to exploit surging wealth levels in emerging markets. And I’m tempted to buy more following the stock market crash.
The post Stock market crash: I’d spend £5k on these cheap UK shares in an ISA today to make a million appeared first on The Motley Fool UK.
Royston Wild owns shares of Prudential. The Motley Fool UK has recommended Prudential. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
Motley Fool UK 2020
First published on The Motley Fool
