While HSBC shares look pretty wonderful, that seems to come as standard for FTSE 100 banks these days. They’ve all done well lately.

One reason is that they’ve finally tidied themselves up after the financial crisis. Another is that they’ve been boosted by several years of higher interest rates. These allowed them to widen net interest margins, the difference between what they pay savers and charge borrowers.

HSBC has been making a lot of money as a result. It has a massive opportunity in Asia, notably in China, Hong Kong and Singapore. Plus it recently opened its first Middle East wealth centre in the UAE. This gives it a more diversified earnings base than a purely UK-focused bank.

Flying FTSE 100 sector

In 2024, it posted bumper pre-tax profits of $32.3bn, up 6.6% from $30.3bn the year before. Profits dipped in 2025 to $29.9bn, but that was largely due to one-offs impairments, legal provisions and restructuring costs. Even so, it’s still a huge number, and the board handsomely rewarded shareholders, hiking the full-year dividend by 13.6%. In the five years since the pandemic, HSBC has increased shareholder payouts at an average compound rate of around 38% a year. Few FTSE 100 companies can match that.

HSBC has also been incredibly generous with share buybacks, which totalled $6bn last year. These have now been put on hold for nine months as it spends £13.6bn completing its stake in Hang Seng Bank. Investors will be hoping they resume after that.

Management has been simplifying the group, exiting weaker markets and focusing on core strengths such as wealth management. It’s now targeting an improved tangible return on equity of 17%, combined with a dividend payout ratio of around 50% of earnings. Today, the trailing yield is 4.4%. That’s forecast to hit 4.48% this year and 5.28% in 2027.

The shares don’t look especially expensive despite their strong run, with a forward price-to-earnings ratio of 10.9. But as always, there are risks.

Share buyback on pause

China isn’t the high-speed growth machine it was, and worries continue to dog its property and shadow banking sector. Big global banks may also have exposure to two potential bubbles, in artificial intelligence and the private credit market. If they burst, HSBC’s loan impairments could increase. The bank’s international footprint is attractive, but it’s also exposed to geopolitical tensions, including today’s Middle East disruption.

The HSBC share price has held pretty steady in recent weeks. There could be more war-related market volatility to come, but any dip could make HSBC look even more tempting, for investors who take a long-term view. This looks like a strong and profitable business trading at a decent price, and well worth considering today.

The post Can nothing stop the rampant HSBC share price? appeared first on The Motley Fool UK.

Therefore, anyone who invested £10,000 in the FTSE 100 bank back then would now have less than £9,000. However, the same amount invested five years ago would today be worth approximately £30,400, even after March’s pullback.

Including reinvested dividends, the total return would be around £34,000. Not bad for a dull ‘old economy’ stock!

Asian growth markets

I bought HSBC stock at 604p in early 2024. With the share price now above 1,250p, I’ve basically doubled my investment, before dividends.

Looking back to the period when I first invested, I wrote: “I expect the bank’s increasing focus on China and Asia to pay dividends (literally). The region is expected to boom in the decades ahead as middle classes expand and prosper. And HSBC will be there to serve them“.

Fast forward to now, my investment thesis hasn’t changed. Indeed, I’m more convinced than ever that significant institutional money will flow towards Asian markets over the next decade, driven by increasingly unpredictable US policy.

If I’m right, this should benefit HSBC, which has significant exposure to Hong Kong, mainland China, India, and Singapore. The lender has also opened up its first Middle East wealth centre in the UAE, where I hear quite a few well-off people reside.

But are HSBC shares worth considering after the 10% dip? I think so. The forward price-to-earnings (P/E) ratio isn’t particularly high at 9.7, while there’s an attractive 5.15% forward dividend yield.

Share buybacks are currently on hold after HSBC bought the 37% stake it didn’t already own in Hong Kong’s Hang Seng Bank for $13.6bn. But buybacks are widely expected to resume sooner rather than later.

The Middle East war clearly adds near-term uncertainty, as HSBC has been selectively increasing its exposure to the region. If there’s a global economic downturn, then banks and their shareholders will likely feel the pain.

As mentioned though, I’m still bullish on HSBC long term.

Boku

Another interesting UK stock is Boku (LSE:BOKU). With a £493m market cap, this is the equivalent of a stickleback compared to HSBC.

However, it’s also riding Asia’s vibrant economies by helping Western companies expand in the region. Its platform makes it easier for unbanked users to pay for goods and services via their smartphones.

Last year, revenue increased 30% to $128.8m, with adjusted EBITDA jumping 36% to $41.3m. Revenue from bundling, which helps tech giants like Netflix and Amazon bundle subscriptions into consumer mobile plans, surged 71% to $14.9m.

Looking ahead, rising inflation is a risk, as this could limit payment volumes growth. This is presumably why the stock has fallen 10% since the end of February.

AI might be another concern. However, as BlackRock Throgmorton Trust (a Boku shareholder) recently said: “As for AI risk, we think Boku is well insulated, considering it is a regulated network operating across multi jurisdictions, with multiple licenses with a deep and broad pool of connections across myriad companies and merchants that is an incredible barrier to entry and hard to replicate.”

Trading at just 19 times forward earnings, I think this under-the-radar growth stock is worth looking into.

The post £10,000 invested in HSBC shares 5 weeks ago is now worth… appeared first on The Motley Fool UK.

Building a reliable income from a portfolio of FTSE 100 stocks can make a real difference later in life. Unlike pensions, the tax-free ISA wrapper doesn’t offer upfront tax relief. However, all capital gains and dividends are free from tax, and withdrawals are tax-free too. That makes it a highly effective long-term tool.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Power of compounding

A £1,000 monthly income adds up to £12,000 a year. Using the widely followed 4% ‘safe withdrawal’ rule, which suggests that taking that percentage of a pot each year will preserve the underlying capital, our investor would need to target £300,000. That may sound daunting, but it can be done with regular investing and long-term compound growth. For example, £250 a month invested in a diversified Stocks and Shares ISA, generating an average annual return of 7%, could grow to around £300,000 over 30 years.

That requires discipline, but shows what’s possible over time. Even smaller sums can build into something meaningful if given long enough to grow.

Rather than simply tracking the index, I’d try to outpace the index by building a balanced portfolio of around 15 to 20 leading shares.

HSBC offers dividends and growth

HSBC Holdings (LSE: HSBA) could be one to consider. The Asia-focused bank has been a strong performer, with shares up 44% over the past year and around 200% over five years. All dividends are on top.

Like every banking stock, HSBC has wobbled since the Iran conflict began. It originally suffered a double-digit drop, but bounced back strongly last week, up 6.3%. Its valuation remains reasonable with a price-to-earnings ratio of 13.9, below the FTSE 100 average of around 17. It also boasts a decent trailing yield of 4.4%. The board has paused its generous share buybacks for now, but they’re likely to return when conditions improve.

Full-year results published on 25 February showed pre-tax profit falling 7.4% to $29.9bn, but that still beat expectations. The decline was largely due to mostly one-off charges totalling $4.9bn. The bank is targeting an ambitious return on tangible equity above 17% in the coming years, up from 13.3% in 2025. That suggests confidence in its longer-term prospects.

Risks and rewards

As with every stock, there are risks to consider. The situation in Iran could worsen, while tensions between the US and China remain a concern. Higher interest rates can boost bank margins, but they can also increase bad debts if borrowers struggle. Even so, with a long-term approach, I think HSBC looks worth considering today.

Recent market volatility has created opportunities across the FTSE 100 and FTSE 250. Many established companies now offer both income and growth at more attractive prices. As the ISA contributions deadline looms, it’s a good time to think about what to buy.

The post How much does an investor need in an ISA to target a £1,000 monthly passive income? appeared first on The Motley Fool UK.

Building a SIPP

First, let’s talk about why £3k is a good target to aim for. That works out at £36,000 a year, which — when combined with the State Pension — could deliver a very comfortable lifestyle.

Pensions UK says that the average single person needs £43,900 a year today to live comfortable. Considering that living costs rise over time, I think a £36k annual SIPP income is a sensible goal.

Now let’s get down to the nitty gritty. How large does a SIPP portfolio need to be to generate this?

It depends on the average dividend yield you can achieve with your investments. The FTSE 100 index’s average yield sits at 3% to 4%, but an investor could potentially get much better than this with some careful stock selection. I think a yield of 6% is certainly possible, backed by top stocks like Legal & General (9.2% currently), HSBC (LSE:HSBA)(5.2%), and Tritax Big Box REIT (6.1%).

With an average 6% yield, you’d need a SIPP worth £600,000.

Wealth boosters

Brits can invest £60,000 into one of these products a year, or 100% of their annual earnings, whichever is lowest. The thing is, only a tiny number actually have that kind of cash on hand to invest.

So how realistic is it to aim for a £600,000 portfolio in retirement? In a word: very. SIPP investors are protected from capital gains and dividend taxes, giving them more money to accelerate the compounding process. Users also benefit from generous tax relief which ranges from 20% to 45% depending on your tax bracket. This can provide a massive extra dollop of cash.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

However, the real engine is the wealth-building power of the stock market itself. Let’s use HSBC again as an example. Over five years, it has delivered an average annual return of 27.9%. That’s through a combination of share price gains and dividend income.

The FTSE bank has successfully harnessed booming wealth levels and population sizes in Asia over the last decade, supercharging profits and shareholder returns. Unsurprisingly, its doubling-down here and selling assets in more mature markets to focus on these emerging regions.

Boston Consulting analysts think Asia will account for 30% of new financial wealth by 2028. On this basis HSBC’s strategy seems an excellent one, as does its decision to invest in areas like wealth management. I’m confident it can thrive even as competitive threats grow.

Bottom line

I’m not saying every share an investor buys will deliver a near-28% yearly return like HSBC. The bank itself faces challenges that could impact its own returns, like slowing Chinese growth and escalating global trade tariffs.

But even if they can achieve the broader stock market’s long-term average of 9% with their portfolio, they could still realistically target a huge retirement income.

At this rate, a £500 monthly investment combining an investor’s own funds and tax returns could create a £600k SIPP in just over 25 years.

The post How to turn a SIPP into £3,000 of monthly passive income appeared first on The Motley Fool UK.

For me, this reflects a broader shift in global asset allocation. Capital is rotating away from high-multiple stocks priced on long-duration promises to companies generating near-term cash flows.

The Glencore re-rating signal

One old economy stock that sums up this notion of the great rotation is Glencore (LSE: GLEN). Its share price is back at its 2022 all-time highs, despite materially weaker earnings.

What stands out is not just the level of the share price, but what it implies. The market appears to be valuing Glencore less as a cyclical earnings proxy and more as a cash-generative industrial commodity business, with embedded optionality in copper and energy transition metals.

That shift matters. Even with profits well below the 2022 super-cycle peak, the company still generates strong cash flow and returns capital to shareholders. That’s exactly what the market is rewarding right now.

Coal remains the key swing factor and continues to weigh on headline profitability, particularly as prices have normalised over the past few years.

More broadly, consolidation in the sector remains a live theme, with past merger discussions involving Rio Tinto highlighting how strategic positioning in copper and other critical minerals could drive the next phase of value creation in the industry.

When banks become cash machines

HSBC (LSE: HSBA) is no longer just a ‘bank trade’. It’s a global cash engine inside the FTSE 100. Geopolitics and regional risks drive short-term volatility, but often hide a far more stable underlying story.

At its core, the bank is leveraged to a structurally higher interest rate environment. Even if central banks eventually ease policy slightly, rates remain well above the ultra-low era that defined the last decade.

That matters because it supports sustained net interest income across its global deposit base, particularly in Asia where much of its earnings power is concentrated.

In simple terms, HSBC doesn’t need rates to rise — it benefits from them staying ‘normalised’ rather than collapsing back to zero.

On top of that sits a clear capital return story. A dividend yield of 4.6%, supported by ongoing buybacks, positions the stock less as a traditional growth bank and more as a yield compounder.

Risks remain, particularly around global growth and geopolitical shocks. But these tend to affect sentiment more than long-term earnings power.

The bigger picture is that the market is re-rating HSBC as a high-yield, structurally supported cash flow business.

Bottom line

What stands out to me is that the FTSE 100 is being re-rated in plain sight. Investors are shifting away from long-duration growth stories and towards businesses delivering cash today. Miners and banks are no longer being priced as purely cyclical — but as cash-generative assets with real return potential.

In that context, I think both Glencore and HSBC are worth a closer look at current levels, given their ability to generate strong cash flow and return capital through the cycle, even in more uncertain macro conditions.

If that shift continues, this may be less of a short-term trade and more of a structural rotation. For me, that suggests the FTSE 100 still has further to run.

The post FTSE 100 shares: the ‘old economy’ trade the market may be misreading appeared first on The Motley Fool UK.

But how do you start the ball rolling and begin building that extra cash flow? There’s no right or wrong answer to that question. But there are certain steps investors can take to boost their chances of achieving a juicy second income.

If you’re starting from scratch — or just looking for some pointers to boost your passive income — here are three strategies to consider:

1. Save on tax

The first step is to stop HMRC from grabbing a large chunk of your hard-earned returns. This can be done easily with a Stocks and Shares ISA or a Self-Invested Personal Pension (SIPP).

Both protect investors from capital gains tax and dividend tax. The effect is twofold — it means greater net profits. And with that profit, you can have more to invest to accelerate the compounding process, meaning a larger pension pot over time.

With the SIPP, retirees may have to pay income tax on any drawdowns. But this can be more than offset by the benefit of tax relief, which the ISA does not offer.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

2. Build a diversified portfolio

Even the most experienced investors buy shares that ultimately fail to deliver. Billionaire investor Warren Buffett famously lost a fat stack of cash when he bought Tesco shares in 2014, and cashed out before the share price recovered.

You’re likely to make mistakes, too. I certainly have. However, I’ve still managed to enjoy a healthy overall return from my portfolio. How? By holding a diversified mix of stocks spanning different sectors and reaching all parts of the globe. That way, I’ve successfully absorbed the impact when one or two holdings have disappointed.

In all, I hold roughly 25 shares, trusts, and funds across my ISA and SIPPs. These include income-paying dividend shares, and growth and value stocks for long-term share price growth. As a result, I can expect a healthy return at all points of the economic cycle.

3. Think long term

It’s easy to panic and sell your shares when the stock market looks set to crash. This can be an expensive mistake — over time, equity markets always bounce back strongly from crises that sink share prices.

Take HSBC (LSE:HSBA), a share I’ve bought for my own portfolio. Being a financial services provider, it’s experienced severe volatility at times, such as during the 2008-2009 banking crisis and the 2020 Covid-19 pandemic. But investors who held on have enjoyed excellent returns.

Over the last decade, HSBC’s share price has soared by 182%. Combined with dividends paid in that time, the bank’s shares have delivered an average annual return of 14.4%. Show me a savings account that has delivered that sort of performance.

The emergence of challenger banks poses an increasing risk going forwards. But I’m confident HSBC’s focus on fast-growing emerging markets should mean more juicy returns for long-term investors. And hopefully it will help me earn a big passive income in retirement.

The post Here’s how you could start your passive income journey this April! appeared first on The Motley Fool UK.

Given how much fear and panic can surround those words, it might seem like an odd question.

In fact though, a crash can provide a rare opportunity to invest in brilliant companies at bargain basement prices. That can help to bring someone’s financial planning for their retirement forward and potentially help them to retire years early.

Here’s how.

A crash is a change in valuation, not necessarily underlying value

When there is a stock market crash, we often hear about how many billions of pounds has been wiped off the value of the stock market. But that does not necessarily mean that the underlying value of the companies has changed.

Why?

Well: think about someone who has a vague notion to sell their house and puts up a sign in the window inviting offers. Each day, someone new knocks on the door and makes an offer, at wildly varying prices. The owner does not accept any of those offers.

The house’s value as their home is unchanged. The bids have suggested a range of different values — but the owner still owns the house.

Making the most of an opportunity

Guess what? The stock market is the same.

Billionaire Warren Buffett illustrates this by reference to the imaginary character, Mr. Market.

Every day, Mr. Market offers you a price at which he will sell you a given share – and a price at which he will buy it from you. But you do not have to sell, even if a stock market crash send the price down sharply.

However, if that happens – and you think the long-term underlying value of a given business remains the same – that could be a great buying opportunity.

Here’s how one could retire early

That can be a very powerful insight when it comes to financial planning for retirement.

For example, at the moment HSBC (LSE: HSBA) commands a share price of around £12. It also has a 4.7% dividend yield. That sounds very attractive, given that the FTSE 100 index (of which HSBC is a member) has a yield of 3%.

But does that mean that HSBC shareholders are all earning a 4.7% yield? No, it does not.

Remember: yield is based on the current share price. But step back to the stock market crash of 2020. HSBC shares fell down to just a few pennies north of £3 apiece.

So, someone who bought then would be sitting on a price gain of well over 300%. They would also now be yielding over 18%.

That is a massive difference.

Compound £100k at 4.7% annually with the goal of reaching a £250k target and it takes 20 years. At an 18% compound annual growth rate, that timeframe is cut to just six years.

Getting ready now

I think HSBC still has a lot going for it: a strong brand and a very sizeable market position, especially in Hong Kong banking.

But the risk of a weakening economy driving up loan defaults means I have no plans to buy it.

It is on my list of shares I would like to own, though, if their price falls far enough. Such a list could be very handy in the next stock market crash, whenever it happens!

The post Here’s how a stock market crash could be brilliant news for your retirement! appeared first on The Motley Fool UK.

At The Motley Fool, we believe investors can generate generous share price growth and dividend income from a balanced portfolio of FTSE 100 and FTSE 250 shares. Entirely tax free. The annual deadline for contributing to this year’s Stocks and Shares ISA allowance expires exactly two weeks today, on April 5. Use it or lose it.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Build that FTSE portfolio

Let’s say an investor wants to generate a second income of £2,000 a year, on top of their State Pension. That adds up to a handsome £24,000 a year. Free of tax, of course.

The 4% ‘safe withdrawal’ rule suggests that if investors take that percentage of their portfolio as income each year, the underlying capital will last as long as they do. So to generate £24k, they’d need a pot of £600,000. Which sounds an awful lot, but can be done with time. Even if investors fall short, they’ll still be a lot better off than if they didn’t try at all.

Let’s say somebody is 30 years from retirement, and builds a portfolio of FTSE 100 shares that deliver an average annual compound return of 7% a year, with dividends reinvested. They’d need to invest £500 a month, or £6,000 a year. That’s well within the £20,000 allowance.

But which shares should they buy? Stock markets are volatile right now, due to the Iran war, but lots of shares have held up pretty well.

HSBC shares worth considering

The HSBC (LSE: HSBA) share price has dipped 5% in the last month, but it’s still climbed 38% over the last year. Over five years, it’s up a mighty 180%. It’s also paid investors heaps of dividends, turbo-charging their returns.

Today, the Asia-focused bank offer a trailing dividend yield of 4.6%, well above the FTSE 100 average of around 3%. Sometimes I’m wary of buying shares after they’ve had a strong run, in case they’ve raced ahead of themselves. Future growth may be slower, or they could even retreat. Of course, this could happen with HSBC, but it’s a solid business, with a huge growth opportunity in greater China.

It’s a true global brand that’s been making massive profits lately – almost $30bn in 2025. That was actually down 7% on the previous year’s $32.3bn, due to one-off costs such as legal charges, a write down and the sale of a loans portfolio. It’s still an awful lot of money.

Every stock has risks. If the global economy slows or slips into recession and customers go bust, HSBC could end up with a lot of loan impairments. Falling interest rates could also squeeze net interest margins, and profits. But I think with a long-term view, it’s well worth considering.

There are plenty more bargain FTSE 100 shares I’d consider adding to my ISA today. Both for growth and passive income. Or with luck, both.

The post Passive income of £2,000 a month in an ISA? Here’s how an investor could aim for that appeared first on The Motley Fool UK.

Looking for beaten-down shares that have the potential to rebound? Here are two names to check out.

A blue-chip FTSE 100 name ‘on sale’

First up, we have banking powerhouse HSBC (LSE: HSBA). It’s currently trading for around 1,180p, down from 1,400p in late February.

Now, while this is very much a ‘blue-chip’ FTSE 100 stock, it is a little risky. That’s because banks are vulnerable to economic weakness and the huge spike in oil prices could potentially lead to a slowdown.

Another risk we need to consider here is AI-related layoffs. These could compromise banks’ mortgage books in the years ahead. But there’s a plus side to this risk too (more of that below).

Looking past these risks, there’s a lot to like here, in my view. For a start, HSBC is focused on higher-growth areas of banking such as wealth management and financial services in Asia.

Second, the company is using the aforementioned AI to become more efficient. Last week, it came to light that the company is planning to shed 20,000 of its own roles in the years ahead.

Third, it looks cheap after the recent market sell-off. At present, the price-to-earnings (P/E) ratio is under 10.

Finally, we now have a dividend yield of around 5%. So, there’s a substantial amount of income on offer.

Given all these positives, I believe the stock is worth a closer look right now.

A FTSE 250 stock for the tech boom

The other stock I want to highlight is Computacenter (LSE: CCC). It’s a FTSE 250 company that helps businesses and government organisations across the world with their IT infrastructure (servers, networking, cybersecurity, etc).

Earlier this year, it was trading above 3,300p. Today, however, it can be snapped up near 2,950p.

Computacenter has quite a bit of operational momentum at the moment. Because right now, organisations are scrambling to upgrade their IT systems for the AI era.

We can see this in the company’s results for 2025, which were posted earlier this month. For 2025, adjusted operating profit was up 11.3% year on year.

Note that the company ended 2025 with a record product backlog of £7.1bn. This bodes well for near-term performance.

It’s worth pointing out that an economic slowdown is a risk here too – this could see companies spend less on technology. AI is also potentially a risk – in the long run, businesses may be able to bypass companies like this using AI agents.

With the stock trading on a P/E ratio of about 15 and offering a yield of around 2.7, however, I see appeal. I reckon it’s worth considering as a play on the tech boom.

The post 2 top stocks to consider buying after this week’s FTSE carnage appeared first on The Motley Fool UK.

So how much does an ISA need to be worth to deliver £800 of passive income each month? And how long will it take to reach this level? Let’s find out by doing a bit of number crunching.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Some maths

Adopting the 4% rule and gradually withdrawing the capital from the investment pot, an ISA would need to be worth £240,000 to provide £800 a month (£9,600 a year).

Alternatively, an individual wishing to preserve their capital could buy some dividend shares. By way of an example, the yield on the FTSE 100 is currently (13 March) 2.8%. With a return like this, an ISA would need to be valued at £309,677 to deliver £800 a month. However, I think it’s possible to do better than this.

Such as?

Take HSBC (LSE:HSBA) as an example. Based on dividends paid over the past 12 months, it’s currently yielding 4.7%. With this level of return, an ISA of £204,255 would be needed to earn £9,600 a year.

Admittedly, this yield isn’t as good as the headline rate available from one of the bank’s regular savings accounts of 5%. However, most savers will have to pay tax on this. And it’s only possible to pay in a maximum of £3,000 over a 12-month period.

By contrast, subject to the annual investment limit of £20,000, there’s no restriction on the value of HSBC shares that can be held in an ISA, nor the level of dividends earned. And remember, any gains and income can be enjoyed tax-free. A word of warning though, dividends can never be guaranteed.

However, in my opinion, there are other reasons to consider the bank’s shares.

An impressive record

Of the FTSE 100’s five banks, HSBC ranks third comparing their historic (trailing 12-months) price-to-earnings ratios. And in 2025, its adjusted profit before tax grew 7% year-on-year.

For the same period, HSBC reported a 13.3% return on tangible equity. But for 2026-2028 it’s now targeting 17%, or more. The strength of its balance sheet means it retains enormous financial firepower and its brand is instantly recognisable across the world.

But there are challenges. Its margin (and earnings) could come under pressure if interest rates fall further. And an economic slowdown would be damaging, especially in Asia. The group’s already suffered heavy losses from the meltdown in China’s property market.

However, with its excellent track record of delivering income and growth, I think it’s an exciting stock to consider for a Stocks and Shares ISA.

Over the past five years, the bank’s share price has grown by an average of 24.9% a year. At this rate an investment of £3,000 a year would grow to an astonishing £1.246m within 25 years. Then, assuming HSBC’s current yield of 4.7% still applies, it would be producing an incredible second income of £58,562 a year.

Of course, it’s important to have a diversified portfolio. And there are plenty of other UK shares available that could complement HSBC in a high-performing Stocks and Shares ISA.

The post How much do I need in a Stocks and Shares ISA to earn an £800 monthly second income? appeared first on The Motley Fool UK.