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Here’s how I’d invest £10k in FTSE 100 shares in an ISA starting today

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Investing £10k, or any other amount, in FTSE 100 shares in an ISA today may seem to be a hugely difficult task for many investors. After all, the index experienced one of its fastest-ever crashes in the first part of 2020, and that was followed by a rebound. Confused? Possibly.

You see, the index’s next move may be difficult to predict. But its longterm growth potential appears to be high. Therefore, focusing your capital on high-quality businesses in sectors with growth potential could be a sound means of increasing the value of your Stocks and Shares ISA over the coming years.

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...

High-quality FTSE 100 stocks

The near-term prospects for the economy continue to be unclear. Unemployment has risen significantly following the lockdown, while consumer confidence is at a relatively low level. As such, a recession seems likely – and could last for a number of months.

Therefore, investors may wish to buy companies that have a high chance of surviving a prolonged period of lower sales. For example, businesses with low debt levels, a large amount of cash and the capacity to cut costs may be in a better position to overcome the short-term risks they face than their peers.

Fortunately, assessing the financial strength of FTSE 100 companies is relatively straightforward. Through obtaining their annual reports and investor updates for free online, you can build a picture of their financial position and whether they are likely to emerge from a recession in a strong position relative to their peers.

Risk/reward opportunities

Assessing the growth potential of a specific FTSE 100 industry is likely to be more challenging than considering a company’s financial strength. It is still too early to know whether some industries are likely to return to growth rates seen before the current crisis, or whether there have been permanent changes to consumer spending.

However, those sectors that have uncertain growth rates could offer the best value for money. Investors may have factored-in their challenging outlooks through lower share prices. This may provide new investors with a margin of safety that enhances their risk/reward opportunity. As such, it could be a sound move to not only assess the growth potential of an industry, but to consider whether its current valuations fully reflect its risks and potential rewards.

A long-term focus

The FTSE 100 could experience a strong rally or a market crash in the short run. As such, it is crucial to take a long-term approach when buying shares at the present time. It may take a number of years for some companies to recover from the current challenges they face, which could mean that investors with a short-term time horizon miss out on their full potential.

Through buying high-quality businesses with long-term growth potential at attractive prices, you could build a surprisingly large ISA that boosts your financial prospects in the coming years.

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.

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