The FTSE 100 doesn’t look frothy, but with warnings of a tech bubble in the US and the index nearing 10,000, it wouldn’t take much to spark a sharp pullback. But rather than fear a crash, I see it as a chance – and there are two stocks I’ll buy immediately should one materialise.
Gold and silver play
The first stock on my watchlist is Mexican gold and silver miner Fresnillo (LSE: FRES). In 2025 alone, it’s surged an astonishing 280%.
A quick look at the fundamentals explains why. In its H1 results back in August, the company reported a 399% jump in earnings per share, with profit up 297% to $118m. With central banks still hoovering up gold – a trend I don’t expect to reverse any time soon – the backdrop remains supportive.
But the next major growth catalyst could be silver. Prices sit near $50 today, while the miner’s all-in sustaining costs across its mines average about $17. That kind of spread means the business continues to generate serious free cash flow.
That said, the risks are real. Mining is a tough, unpredictable business. If Fresnillo misses production targets or encounters operational issues, the share price could be punished brutally.
Insurance giant
Another business I’ve long admired is Aviva (LSE: AV.). Once dismissed as a dull, overly complex insurer with too many moving parts, it has undergone a remarkable transformation under CEO Amanda Blanc. Shareholders have certainly noticed – the stock is up 35% in 2025 alone.
Over the past five years, total shareholder returns have reached 260%, fuelled by more than £10bn handed back through dividends and share buybacks.
And in my view, the growth story is far from over. A string of strategic acquisitions strengthens the investment case: Succession Wealth, specialist Lloyd’s broker Probitas, and Optiom, a Canadian vehicle-replacement insurer. But the boldest move by some margin has been the takeover of Direct Line Group, which significantly expands its reach across UK general insurance.
New targets
With the Direct Line acquisition progressing well – and its previous strategic goals delivered a full year early – it’s now raised the bar with a fresh set of ambitious targets.
First, it has doubled its expected cost synergies from Direct Line to £225m. By 2028, the insurer expects over 75% of its business to be capital-light (up from around 70% today), freeing up more cash for dividends and buybacks – exactly what long-term income investors like to see.
Management has also set aggressive new three-year goals: operating EPS growth of 11% a year between 2025 and 2028 and an IFRS return on equity of 20% by 2028. These are big ambitions and reflect a business acting far more like a disciplined growth company than the sprawling conglomerate it once was.
The main risk here is that the Direct Line integration proves tougher than expected, with any cost overruns or claims inflation quickly eating into margins. Motor and home insurance remain highly sensitive to repair costs and weather-related losses, so a spike in either could dent future profitability.
Bottom line
Even if the FTSE 100 suffers a sharp pullback, I won’t panic. Quality businesses with strong cash generation can weather volatility and offer opportunities for patient investors. But these aren’t the only investing opportunity I’ve got my eyes on.
