The stock market crash swung into recovery mode last week, with the FTSE 100 now up 15% since its lows in late March. Despite that, investors still have a massive opportunity to buy bargain blue-chip stocks, and this is where I would invest today, rather than in precious metal gold or crypto-currency Bitcoin.
I’ve been taking advantage of the share price crash to top up my FTSE 100 trackers, seeing this as a great buying opportunity. I’d much rather buy equities tax-free in a Stocks and Shares ISA than gold or Bitcoin and here’s why.
The gold price is up almost 35% over the past 12 months, but it is now struggling to climb higher. Last month should have been perfect for gold, as panicked investors ran to traditional safe havens, but in fact the price fell slightly.
Trading at nearly $1,700 an ounce, gold is expensive, and could slip back if sentiment recovers.
Gold and Bitcoin worry me
Bitcoin will have disappointed those who claimed it was a safe haven asset class that behaved in a different way to shares. In fact, it has crashed faster than the FTSE 100 during this year, halving from just over $10,000 to around $5,000 at one point. The crypto-currency remains hugely unpredictable, and I wouldn’t want to bet my financial future on it.
The stock market may also have crashed, but unlike gold and Bitcoin, companies listed on the FTSE 100 actually have something to offer the real world. You could live without gold, which has few practical uses, and Bitcoin, which frankly has none. You would struggle without energy firms, utilities, supermarkets, banks and pharmaceutical companies.
What a FTSE 100 buying opportunity
I wouldn’t want to base my early retirement plans on gold and Bitcoin. Especially since neither pay any interest. FTSE 100 stocks are how I plan to invest for my retirement and today is a great buying opportunity.
Some of you may be wary about investing given today’s volatility, but there’s a simple way to get round this. You should invest for the long term, 10 years at least. Over such a lengthy time, today’s bear market worries will soon fade.
Invest now to retire early later
In fact, the FTSE 100 often recovers from a stock market crash to hit fresh highs, as investors leap on buying opportunities, and keep buying. It’s part of the natural investment cycle. The trick is to buy at the bottom of the cycle, like today, rather than the top.
It could take some years for the market to fully recover from the coronavirus shock, but if you can leave your money invested, then you should reap the rewards later. This is a great opportunity to buy top FTSE 100 stocks, and use them to fund your early retirement.
According to one leading industry firm, the 5G boom could create a global industry worth US $12.3 TRILLION out of thin air…
And if you click here, we’ll show you something that could be key to unlocking 5G’s full potential...
It’s just ONE innovation from a little-known US company that has quietly spent years preparing for this exact moment…
But you need to get in before the crowd catches onto this ‘sleeping giant’.
Harvey Jones has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. 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.