3 FTSE shares on my shopping list if the stock market dip becomes a crash

Rather than worry about his portfolio, our writer is busy compiling a list of quality FTSE stocks he’d buy if things turn from bad to worse.

| More on:

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.

Middle-aged black male working at home desk

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

It’s fair to say that August has got off to a bumpy start for global stock markets. But this plays right into the hands of long-term focused Fools like myself. So, I’ve been doing what I’ve always done at times like this — making a list of FTSE shares I’d consider buying if things head further south.

Allianz Technology Trust

Allianz Technology Trust (LSE: ATT) endured a horrible last month. As I type, the share price is down by 17%.

This is, of course, no surprise. The recent mass sell-off in US tech titans was always going to smash sentiment in an investment trust that only invests in this often-volatile part of the market.

Should you invest £1,000 in Allianz Technology Trust Plc right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets. And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Allianz Technology Trust Plc made the list?

See the 6 stocks

But this is why looking at performance over years rather than months is so vital.

Despite recent poor form, the trust has delivered a share price gain of 93% in the last five years. Compare that to the FTSE 250 index in which it features (+6% over the same period) and we see just how profitable stock-picking can be.

Yes, there’s a risk that today’s (Tuesday’s) relief rally will run out of steam. But I reckon it’s a brave soul to suggest this investment trust can’t/won’t eventually recover and then some. After all, we’re only at the very beginning of an AI story that could provide a boost for decades to come.

Auto Trader

A second firm I’ve been eyeing up is vehicle marketplace provider Auto Trader (LSE: AUTO).

This company has many of the ‘quality’ hallmarks I look for when hunting for the best growth stocks to buy. These include a dominant position in its niche and a strong balance sheet that should withstand another period of economic upheaval. Thanks to it operating exclusively online, the FTSE 100 business also generates some of the biggest margins in the entire UK stock market!

There’s just one problem — Auto Trader’s stock hasn’t dropped by much in recent days.

According to my data provider, the shares still trade at a forecast price-to-earnings (P/E) ratio of 24. As great as this business is, that’s still dear. And one thing I’ve learned is that expensive stocks tend to get hit harder than most when a dip becomes a market crash.

So, I’m keeping this one on my wishlist for now.

IG Group

A third candidate to buy if it turns out we are going to hell in a hand cart is IG Group (LSE: IGG). In contrast to the other companies mentioned here, the online trading platform provider really makes its money when markets are volatile and traders try to take advantage of emotions jumping from greed to fear and back again.

Another contrast to note is that this stock is a lot cheaper than the Allianz trust or Auto Trader. The P/E sits a just below nine!

As good as this sounds, it’s worth highlighting that neither of the above will definitely protect the share price from falling in the event of a market crash. Some investors will invariably sell what they can to raise cash in times of trouble. This probably includes IG as its market capitalisation is over £3bn (which means its stock is very liquid).

On the other hand, there is a chunky, well-protected 5.3% dividend yield in the offing to compensate for any temporary paper loss.

But this isn’t the only opportunity that’s caught my attention this week. Here are:

5 Shares for the Future of Energy

Investors who don’t own energy shares need to see this now.

Because Mark Rogers — The Motley Fool UK’s Director of Investing — sees 2 key reasons why energy is set to soar.

While sanctions slam Russian supplies, nations are also racing to achieve net zero emissions, he says. Mark believes 5 companies in particular are poised for spectacular profits.

Open this new report5 Shares for the Future of Energy — and discover:

  • Britain’s Energy Fort Knox, now controlling 30% of UK energy storage
  • How to potentially get paid by the weather
  • Electric Vehicles’ secret backdoor opportunity
  • One dead simple stock for the new nuclear boom

Click the button below to find out how you can get your hands on the full report now, and as a thank you for your interest, we’ll send you one of the five picks — absolutely free!

Grab your FREE Energy recommendation now

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has recommended Auto Trader Group Plc. 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.

More on Investing Articles

Investing Articles

At a 52-week low but forecast to rise 73%! Is this growth share the FTSE’s top recovery play? 

This FTSE 100 growth share has taken an absolute beating over the past two years but Harvey Jones says the…

Read more »

Investing Articles

This FTSE 250 share offers a juicy 9.8% yield. Will it last?

This well-known FTSE 250 share has a percentage dividend yield approaching double digits. Should Christopher Ruane add the income share…

Read more »

Investing Articles

Is a £333,000 portfolio enough to retire and live off passive income?

A third of a million pounds can generate a serious amount of passive income, but relying on this sum alone…

Read more »

The flag of the United States of America flying in front of the Capitol building
Investing For Beginners

Why FTSE 100 investors should pay attention to ‘Liberation Day’

Jon Smith explains why the upcoming tariff announcement from across the pond could have an impact on the FTSE 100,…

Read more »

Concept of two young professional men looking at a screen in a technological data centre
Investing Articles

Here’s why Nvidia stock fell 13% in March

The Nvidia stock price rise was looking unstoppable. Should investors now be wondering if the same might be true of…

Read more »

US Stock

It’s ISA deadline week! Here’s my 3-step game plan

Jon Smith tries to calm the hype around the last minute ISA rush to buy stocks and explains why he's…

Read more »

Snowing on Jubilee Gardens in London at dusk
Investing Articles

£10,000 invested in BAE Systems shares at Christmas is now worth…

BAE Systems shares have been surging in the FTSE 100 in 2025, driven higher by the wavering US commitment to…

Read more »

Investing Articles

Up 19% in 2 weeks, can the Tesla share price rebound further?

Tesla's first-quarter delivery numbers came out today. Will they help persuade our writer to invest his money at the current…

Read more »