Here’s why you shouldn’t panic after the FTSE 100 crashed below 6,000

With the FTSE 100 (INDEXFTSE: UKX) in a rout, this really is time for long-term investors to keep cool heads.

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

The headlines are screaming “Black Monday“. The oil price has slumped to $45, and we’ve had a FTSE 100 crash of 8.8%. What a way to start the week.

I was only just pondering what to do if the Footsie falls below 6,000 points, and it’s already happened. Early Monday morning, London’s top index dropped as low as 5,891.56 points.

Inflation Is Coming

Inflation is out of control, and people are running scared. But right now there’s one thing we believe Investors should avoid doing at all costs… and that’s doing nothing. That’s why we’ve put together a special report that uncovers 3 of our top UK and US share ideas to try and best hedge against inflation… and better still, we’re giving it away completely FREE today!

Click here to claim your copy now!

The reason is understandable, in the wake of the weekend’s coronavirus developments. UK cases are starting to climb, and pretty much the whole of northern Italy is now on lockdown. Some UK supermarkets have even started rationing hand wipes, and I’ve seen photos of shelves having been emptied of dried pasta.

Is there really any need for such short-term worry? Well, over the coronavirus, yes there clearly is a need for concern — but not panic. Follow recommended procedures, perhaps keep away from crowds as far as possible, and keep washing those hands. But beyond that, the way I look at it is there’s nothing further I can do. The virus will take its course, and some time in the not-too-distant future, it will be finished.

Market crash

Once the virus is in the past, there are a few things I am confident of. One is that the FTSE 100 crash will reverse.

Another is that the State Pension won’t have got any better, and we’ll all still need to save and invest for our futures. And all of the great companies in the FTSE 100 will still be there making profits and paying dividends to shareholders.

Now, it might seem a little mercenary to be thinking of money and profits at a time like this. But for me, investing in shares isn’t about greed, or making a quick killing. No, it’s about providing for my family over the long term — because there’s nobody else who’s going to do it. So where does that leave me now?

Long term

Well, the final thing that I’m absolutely convinced of is that it’s time for a long-term vision. That’s the way we should always view our investments. But our mettle is being tested right now, more than at any time I can remember.

Selling shares during the panic will surely prove to be a poor strategy. It’s always been a poor strategy. This time’s no different.

Many investors were selling out at the depths of the banking crisis. But since the worst of that slump around the start of 2009, the FTSE 100 has just about doubled in value. That’s even after the latest coronavirus collapse. Oh, and investors have also been pocketing growing dividend yields, reaching well above 4% per year.


People right now are worried about where the value of their pension investments is going to be in a week’s time. A month. A few months. Which shares are going to fall further in the coming weeks, and which could you sell today to avoid further losses?

I simply don’t have the answers to those questions. Nobody does. But where will the FTSE 100 be in 10 years’ time? With a high level of confidence, I can tell you I expect it to be way higher than it is today. I’m putting my money on it.

More on Investing Articles

Warren Buffett at a Berkshire Hathaway AGM
Investing Articles

How I’d apply the Warren Buffett method to buying shares

Learning from billionaire investor Warren Buffett, our writer explains his own approach to investing in shares for his portfolio.

Read more »

pensive bearded business man sitting on chair looking out of the window
Investing Articles

This dividend share yields under 1% — but I’d still buy it

This dividend share has a low yield. So why would our writer consider adding it to his income portfolio?

Read more »

Young lady working from home office during coronavirus pandemic.
Investing Articles

Looking for a good share to buy? Here’s how I do it

Here are two approaches our writer uses when hunting for a good share to buy for his portfolio to aim…

Read more »

man in shirt using computer and smiling while working in the office
Investing Articles

One cheap FTSE 100 share I’d buy for a new bull market

This FTSE 100 share is unloved and starting to look seriously cheap, says Roland Head.

Read more »

Young brown woman delighted with what she sees on her screen
Investing Articles

How I’d invest £500 in UK shares in 2022

Investing a small amount of capital in UK shares can result in high commission costs. Zaven Boyrazian explains how to…

Read more »

Black woman using loudspeaker to be heard
Investing Articles

2 battered FTSE dividend stocks to buy in July!

I'm still searching the FTSE 100 for the best bargains to buy. I think these two big dividend shares are…

Read more »

Woman pulling baffled face
Investing Articles

Can I trust Lloyds’ 6.1% dividend yield?

The Lloyds' share price has sunk in 2022, causing the bank's dividend yield to leap. But can I really trust…

Read more »

Young mixed-race woman looking out of the window with a look of consternation on her face
Investing Articles

3 top stocks to buy before the market rebounds

Edward Sheldon highlights three beaten-up stocks he'd buy before global stock markets stage a recovery from their 2022 declines.

Read more »