The Motley Fool

Forget Cash ISAs, buy-to-let and Bitcoin: I’d buy FTSE 100 stocks after the market crash

The recent stock market crash may mean that many investors consider opportunities outside of the FTSE 100. That’s understandable, since the index has experienced one of its fastest declines since inception.

However, other assets such as Cash ISAs, buy-to-let properties and Bitcoin face their own challenges. On a risk/reward basis, therefore, FTSE 100 stocks could offer the most favourable long-term prospects for investors – even after a hugely challenging few months.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

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...

Cash ISAs versus FTSE 100 stocks

Cash ISAs may offer no risk of loss as long as you have no more than £85k invested at a single banking group, but their returns could prove to be hugely disappointing. Interest rates are already at historic lows, but negative rates are currently not being ruled out by the Bank of England. This could mean that holders of Cash ISAs experience further declines in their returns so that they are below inflation over the medium term.

A negative after-inflation return means a loss of spending power. Over time, this can make it more difficult to improve your financial prospects versus investing in the FTSE 100. As such, for long-term investors, Cash ISAs may not prove to be a productive use of capital.

Buy-to-let property

Even though buy-to-let property could experience capital growth that rivals that of the FTSE 100 over the long run, it faces risks in the short term. Notably, void periods may be longer than usual due to higher unemployment and weak GDP growth. There may also be a lack of rental growth in the coming years that limits your total returns.

However, possibly the biggest risk facing buy-to-let investors is a lack of affordability across the sector. This could not only limit capital return prospects, but may mean that buying a property requires a substantial initial investment that many people simply do not have. Therefore, building a diverse property portfolio could be a difficult process that leaves many investors with a high degree of risk.

Bitcoin

The Bitcoin price has surged higher over recent months, and has outperformed the FTSE 100. However, this is largely due to investor sentiment, since the virtual currency has no fundamentals. Therefore, investors have no way of knowing if it offers good value for money.

Looking ahead, Bitcoin could experience a slower pace of growth. Competition from other virtual currencies and concerns about its regulatory risks could hold back investor sentiment. As such, from a risk/reward perspective, it may not be relatively attractive.

FTSE 100 opportunities

The FTSE 100’s market crash could mean that there are buying opportunities available across the index. Historically, it has recovered strongly following its downturns, and the same outcome may be ahead this time around.

As such, now could be the right time to stick with FTSE 100 stocks through buying a diverse range of them. They could outperform other popular assets and boost your financial prospects over the long term.

A Top Share with Enormous Growth Potential

Savvy investors like you won’t want to miss out on this timely opportunity…

Here’s your chance to discover exactly what has got our Motley Fool UK analyst all fired up about this ‘pure-play’ online business (yes, despite the pandemic!).

Not only does this company enjoy a dominant market-leading position…

But its capital-light, highly scalable business model has previously helped it deliver consistently high sales, astounding near-70% margins, and rising shareholder returns … in fact, in 2019 it returned a whopping £150m+ to shareholders in dividends and buybacks!

And here’s the really exciting part…

While COVID-19 may have thrown the company a curveball, management have acted swiftly to ensure this business is as well placed as it can be to ride out the current period of uncertainty… in fact, our analyst believes it should come roaring back to life, just as soon as normal economic activity resumes.

That’s why we think now could be the perfect time for you to start building your own stake in this exceptional business – especially given the shares look to be trading on a fairly undemanding valuation for the year to March 2021.

Click here to claim your copy of this special report now — and we’ll tell you the name of this Top Growth Share… free of charge!

Peter Stephens 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.