It doesn’t matter what your attitude to risk is. If another stock market crash happens I reckon you should take the opportunity to get rich by buying cheap UK share prices.
The chances of another market crash have certainly picked up in recent days as Covid-19 infection rates have spiked again. And a subsequent reinstatement of quarantine measures in some places has raised fears of a very slow economic recovery.
Buying low UK share prices
This doesn’t mean that you and I should stop buying UK shares, however. Stock market crashes are dramatic and quite uncomfortable to watch. No one likes watching the value of their investments go down the toilet. But remember that share market corrections are nothing new, and history shows us that investors who don’t panic and hold onto their shares should still expect to make excellent returns.
Remember that you only realise an actual loss when you sell your stocks at a lower price than you bought them for. If you’ve bought quality stocks in a balanced portfolio you’re likely to see those UK share prices rebound in value over time.
Indeed, we at The Motley Fool believe that a fresh collapse in UK share prices could boost all our chances of getting rich over the long run. Buying top-quality UK shares at rock-bottom prices allows us to maximise our returns as improving economic conditions drive their prices higher again.
Protect yourself from another stock market crash
I can sympathise with investors who remain reluctant to buy UK share prices that indicate blockbuster value, though. The worst economic crash for generations (and, in the case of the UK, for 300 years) isn’t something to take likely. However, there are a multitude of brilliant stocks that should hold up strongly in the event of another stock market crash.
Precious metal stocks are some of these exceptional lifeboats. While the broader stock market continues to struggle, silver producer Hochschild Mining, for instance, came close to hitting new three-year highs on Friday. Highland Gold Mining came within a whisker of printing new record peaks around 300p. And platinum group metals (PGM) giant Tharisa has just hit its most expensive level since the 2020 stock market crash began in late February.
There’s plenty of scope for these UK share prices to keep booming as the economic outlook darkens, too. Indeed, the boffins at ING expect gold prices to hit a new record of $2,100 by the year’s end. The outlook for precious metals beyond the next year or so looks quite robust as well, as ultra-loose central bank policy is here to stay.
So don’t sit on the fence and stop buying stocks on fear of another market crash. I reckon buying these UK shares is a great way to try to get rich without losing any sleep.
Royston Wild 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.