Meanwhile, back home, the FTSE 100 is more popular for high-yielding dividend stocks. That’s because UK investors have historically been more income-inclined.

That can make UK shares feel boring. But for those who look beyond the megacaps, hidden growth gems exist.

I’ve found three that are far outpacing the S&P 500 this year.

CMC Markets

CMC Markets (LSE: CMCX) is a multi‑asset online trading and investing platform that quietly turned a strong year of volatility into record results. Recent FY2026 results revealed net operating income up 15% to £392.6m, while profit before tax climbed 20% to £101.3m.

Management is aggressively chasing institutional and B2B partnerships, Australian stockbroking alliances, and API deals with online banks. It’s also mentioned plans for a UK ‘Super App’. With return on equity (ROE) at around 17%, it appears to be using shareholder capital efficiently. 

The flip side is that CMC is entering a heavy investment phase, with operating expenses rising as it funds this growth. That adds a degree of execution risk.

If you’re bullish about the rise of retail and ‘gamified’ trading, it’s one worth considering. I think it’s got real potential.

Hardide

Hardide (LSE: HDD) is an AIM‑listed penny stock that provides specialist coatings. The shares hover around 70p–80p, with a market cap close of £57.5m.

For the year to 30 September 2025, revenue increased 27% to £6m and EBITDA reached £1m, moving the business firmly into profitable territory. Return on equity (ROE) looks high at 33%, but partly reflects a modest equity base.

Management is focused on aerospace and energy customers, with growth plans centred on North America. It’s a good angle, but also exposes the shares to customer concentration and industrial cycles.

Valuation is where things get uncomfortable. Recent ratios show a price‑to‑book (P/B) ratio of 7.78, far above many industrial peers and consistent with extreme overvaluation.

That means the current price is probably highly speculative. It could still go further, but I’d only consider a very small position at this point.

Keller Group

Keller Group (LSE: KLR) is a global ground‑engineering contractor, with a solid foundation in infrastructure and construction. I find that preferable to the hyped-up, speculative growth stories in US tech.

The 2025 annual report describes “record financial performance”, with revenue up 3% to £3,087.3m and underlying operating profit up 2.6% to £218.2m (at a 7.1% margin). A high ROE around 23% suggests Keller is not messing around with its shareholder capital.

The group finished 2025 in a net cash position of £59.7m, with a £1.5bn order book and plans for a £100m share buyback. CEO James Wroath said it was “a time of such strong performance and clear opportunity,” underlining management confidence. 

The thing is, construction and infrastructure is cyclical, so if the market weakens, Keller will follow. That adds volatility risk for investors.

Still, with a mix of decent growth potential and a sensible valuation, it feels like a quality compounder. For investors with a 10-20 year outlook, it’s another strong contender worth considering.

Should you invest £5,000 in Cmc Markets Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Cmc Markets Plc made the list?

Mark Hartley does not hold any positions in the companies mentioned.

The post 3 under-the-radar UK growth shares that are quietly beating the S&P 500 in 2026 appeared first on The Twelfth Magpie.

For example, Raspberry Pi‘s (LSE:RPI) surged 165% since January. And CMC Markets (LSE:CMCX) is up 141% over the same period. Both are small-cap-turned-mid-cap businesses that have stunned the market with back-to-back earnings upgrades.

But can they really keep climbing from here?

Why Raspberry Pi’s erupted

If you aren’t familiar with Raspberry Pi, it’s the Cambridge-based company behind the credit-card-sized computers beloved by engineers, hobbyists, and educators the world over.

Since listing on the London Stock Exchange in 2024, it’s quietly transformed from a charity-adjacent education project into a serious industrial computing business.

The most recent trading update told a remarkable story. In the first half of 2026, the company expects to sell over 4m units and subsequently upgraded its full-year EBITDA guidance to significantly above the market consensus of $42m.

The driver? A surging wave of demand from OEM customers who are using Raspberry Pi’s technology to build out AI edge computing power as well as industrial automation systems. And with AI-related spending still accelerating, this massive tailwind doesn’t look like slowing.

However, the gravy train might be about to encounter a serious problem. For the most part, Raspberry Pi’s been successfully leveraging its memory stockpiles to continue manufacturing its chips at low cost.

But those stockpiles are starting to run low. And with memory prices skyrocketing across the sector, gross margins could face significant compression risk in the second half of 2026. And after such an impressive bull run for its share price, a sudden deterioration of profitability could spark a painful sell-off.

What about CMC Markets?

CMC Markets is an online financial trading platform and is in a very different situation to Raspberry Pi. The firm allows both retail and institutional investors to engage with contracts for difference (CfD), spread betting, and other stockbroking services.

The firm makes its money by charging transaction fees, which ties revenue to trading activity. But in 2026, that isn’t what’s caused the stock to go parabolic. Instead, this newfound momentum actually stems from new business partnerships.

Third-party operators can now tap in and piggyback CMC’s platform instead of building out their own trading infrastructure, giving CMC a rapidly-expanding, low-effort, high-margin revenue stream.

Subsequently, its latest trading update revealed a massive guidance upgrade for its 2027 fiscal year (ending in March). Specifically, net operating income is now expected to be at least £550m versus earlier guidance of £460m-£480m.

Is now the time to buy?

Like Raspberry Pi, CMC Markets has its weak spots. Structurally, the company remains highly dependent on trading activity to generate transaction fees. With the stock market becoming increasingly volatile, the company’s currently enjoying the peak of this cycle. But when market conditions eventually cool, growth could slow considerably, or potentially even reverse.

Much like memory shortages, it’s a real risk that investors must consider carefully. Having said that, with impressive long-term growth potential, both companies could be worth investigating further today. And they’re not the only opportunity that’s caught my eye right now…

What income stock do we like better than Cmc Markets Plc right now?

One of our Share Advisor analysts has just released a brand new stock report that we think is a must-read for any investor looking to try and generate potential income.

And the best bit is that you can see if for yourself, right now, absolutely free of charge!

No jargon. No hard sell. Just a clear look at an income share we think is worth your time.

Zaven Boyrazian does not hold any positions in the companies mentioned.

The post Up 140%+! Should I buy these rising FTSE 250 stocks today? appeared first on The Twelfth Magpie.

At 591.5p, CMC shares have rocketed 29% on Wednesday (1 July). That takes gains over the past 12 months to 132%. Yet despite the rally, the shares still offer tremendous value in my opinion.

Its forward price-to-earnings (P/E) ratio is a reasonable 12.1 times. But that’s not what’s caught my eye. What has is its rock-bottom price-to-earnings growth (PEG), which is brilliantly low relative to its profit trajectory.

I’ll come back to that shortly. But first, let’s look at how CMC has become one of the FTSE 250’s fastest-growing shares.

What’s happening?

CMC Markets is a financial services company providing online trading and investing platforms for retail, professional and institutional clients. It’s thriving as its higher-margin business-to-business (B2B) operation grows, and announced today that it had

“Entered the new financial year with strong momentum driven by exponential and exceptional growth in our B2B business. That momentum has continued to build and scale.“

In terms of cold hard numbers, CMC now reckons net operating income for this financial year (to March 2027) “to be at least £550m.” That’s substantially above the £460m-£480m it predicted just a month ago, and suggests year-on-year growth of 40% or more, up from 15% last year.

At the same time, its operating expenses (excluding bonuses for employees) forecasts remained unchanged at £280m.

The result?

CMC’s bottom line is also now tipped to explode. EBITDA growth — which was 14% in fiscal 2026 — is expected at 112% this time around, at £250m.

But why?

CMC Markets had traditionally focused on individual traders, which remains high-growth and massively profitable. But by increasingly providing its technology and market access to other financial firms under ‘white label’ agreements, the firm enjoys significant advantages including:

• More predictable earnings thanks to long partner contracts.
• Lower client acquisition spending, as B2B partners already have established customer bases.
• Better margins, because trading technology can serve additional customers at relatively little extra cost.
• Larger contracts that generate revenue equivalent to thousands of retail traders.

There are drawbacks to this approach. A few large partners can account for a significant share of revenue, and contract losses can have a devastating impact. CMC also needs to keep investing huge sums to remain competitive.

Yet the company has the bit between its teeth right now, as Wednesday’s update shows. And it has “a continuous pipeline of new B2B opportunities” to exploit as the market rapidly grows.

A FTSE 250 share to consider?

As I say, CMC Markets shares are still dirt cheap right now. Its PEG ratio for financial 2027 is 0.3. And it remains low at 0.8 for next year. For investors seeking UK growth stocks that offer compelling value, I think it’s one of the best FTSE 250 shares to consider today.

Should you invest £5,000 in Cmc Markets Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Cmc Markets Plc made the list?

Royston Wild does not hold any positions in the companies mentioned.

The post Up 132% and surging, how is this FTSE 250 share STILL so cheap? appeared first on The Twelfth Magpie.

Investors could have pocketed much bigger gains from individual UK stocks though. Take a look at the CMC Markets (LSE: CMCX) share price – it’s up about 90%.

I’ve been bullish on CMC Markets for a while

I’ve covered the trading and investment platform operator a few times this year. And I’ve always been bullish on the stock given the high level of volatility in the financial markets at the moment.

I was right to be bullish. Because the stock just keeps rising – today it has jumped another 23% on the back of a brilliant trading update.

A huge hike to guidance

In the update, the company says that the momentum that it highlighted in its FY26 results has continued to build and scale. As a result, the group now expects net operating income for FY27 to be at least £550m, materially ahead of previous guidance of £460m to £480m, with EBITDA guidance of £250m.

“The strength of this performance reflects the scale of our B2B platforms driving operational gearing and delivering higher profit margins as income growth is delivered against a largely fixed cost base.”
CMC Markets

It goes on to say that performance is being driven by the operational gearing of its B2B platforms (CMC provides whitelabel trading platforms for other institutions). It adds that the B2B platform business is well positioned to scale with several important milestones expected over the next 12 months and a continuous pipeline of new opportunities.

Worth considering for an ISA or SIPP?

Is there an investment opportunity to consider here? I think so.

While the stock has had a great run this year, I see the potential for further gains in the medium to long run. Taking a three-to-five year view, I reckon this company will deliver impressive returns for investors.

One reason I’m bullish is the backdrop that I noted above. Financial markets continue to be volatile, and this is drawing in traders and investors, which is great for a trading and investment platform operator like CMC Markets.

Another is the company’s B2B operations. Not only do these operations give the company a high level of scalability but they also have the potential to push profits up sharply due to the largely fixed cost base.

Finally, there’s the valuation. It still looks reasonable, even after today’s 23% share price pop.

Before today, the stock was trading on a price-to-earnings (P/E) ratio of about 12.8 looking at the consensus earnings forecast of 35.8p per share. If we assume that earnings will now be 10% higher than previous forecasts, the P/E ratio is still only about 14.

I’ll point out that there also’s a nice dividend here. At present, the yield is around 3.2%.

Now, there are risks of course. A slowdown in trading activity and competition from bigger rivals are two to think about.

Overall though, I see the risk/reward skew as attractive. I believe CMC Markets shares are worth considering.

Should you invest £5,000 in Cmc Markets Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Cmc Markets Plc made the list?

Edward Sheldon does not hold any positions in the companies mentioned.

The post The CMC Markets share price is smashing the FTSE 100 in 2026. Is there an opportunity here? appeared first on The Twelfth Magpie.

CMC provides online trading services, and has swept higher on a string of brilliant trading statements. Another strong update today (4 June) has led to a 17% share price gain on the day.

CMC’s guidance today suggests there could be more to come, too. So what’s it said?

Strong numbers

Pre-tax profits for the last fiscal year (to March 2026) actually came in lighter than broker forecasts by roughly 5%. But at £101.3m, a year-on-year increase of 20% was still a solid result.

Net operating income rose 15% to £392.6m, the highest level on record excluding financial 2019. Back then, income soared as Covid-19 bolstered trading activity and volatility on financial markets.

CMC’s Trading division continues to drive business. Net revenues here leapt 16% to £289.5m, the unit benefitting from increased participation from retail traders, and contributions from institutional and business-to-business (B2B) partnerships.

But just as during the pandemic, CMC also benefitted greatly from market volatility. Founder and chief executive Lord Cruddas noted volatile conditions in the second half due to

Tariffs, wars, de-dollarisation narratives, a parabolic move in gold and silver, persistent energy supply and demand tensions, and AI-driven speculative behaviour, especially across commodities.

So what next?

CMC is expecting to maintain its strong momentum this year, tipping net operating income growth of “at least” 17%. On the downside, operating costs are expected to rise by roughly 7%.

According to Lord Cruddas,

CMC has reached a very exciting inflection point, and we now stand ready to enter the next phase of growth, driven by the scale of the platform and infrastructure we have built over recent years.

Over the next year, the FTSE 250 company plans to:

• Launch a technology-sharing partnership with Westpac and ASB Bank.
• Consolidate its services into a so-called Super App.
• Build infrastructure for the trading of tokenised assets.
• Expand further into Europe’s derivatives markets.

What do analysts say?

Following today’s update, RBC Capital analysts noted that the firm

Has collected well amid favourable market conditions in FY26 and the strategic initiatives [CMC] is undertaking should deliver further growth in FY27 and beyond. We don’t think the share price gives full credit to its attractive financial profile.

CMC’s forward price-to-earnings (P/E) ratio has risen to 13 times after today’s result. Yet that’s still pretty undemanding in my view, given the firm’s strong execution and bright growth prospects.

So are CMC shares a buy? Perhaps, though it’s also important to consider the significant risks here before diving in. Competition is fierce, and its rivals are also investing heavily in their own technologies and product expansion. There’s also the ever-present danger of regulatory restrictions on the trading of certain asset classes like derivatives.

That said, I’m considering buying this FTSE 250 stock myself for when I have cash to invest.

Should you invest £5,000 in Cmc Markets Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Cmc Markets Plc made the list?

Royston Wild does not hold any positions in the companies mentioned.

The post FTSE 250 stock CMC’s shares have rocketed 51%! What’s going on? appeared first on The Twelfth Magpie.

Here, I’m going to highlight the bull case and look at the company’s latest numbers (which are fantastic). Could this stock be worth considering for an ISA or SIPP?

A scalable business model

CMC is a leading provider of investment and trading platforms. Today, it operates in 12 countries, serving around 2m investors and traders.

The beauty of its business model is that it can profit both when markets are rising and when they’re falling (traders often try to capitalise on volatility). Another attraction is that it’s very scalable – not only does it have the potential to consistently onboard new customers onto its platforms but it’s also doing white-label deals with other institutions.

Sensational results

The power of this business model is illustrated in today’s (4 June) preliminary results for the financial year ended 31 March 2026. For the year:

• Net operating income was up 15% year on year to £392.6m.
• Profit before tax was up 20% to £101.3m.
• Basic earnings per share (EPS) were up 22% to 27.5p.

On the back of this strong performance, the company hiked its dividend by 21% to 13.8p per share. That translates to a yield of around 3.2% at today’s share price up (which is up about 17% after the results).

What’s driving growth?

Digging deeper into the results, the company said that it saw a record performance in its Australian stockbroking business (it’s now the second largest stockbroker in Oz after doing a major deal with Westpac bank). Here, net operating income was A$140.3m, up 32% year on year.

It also saw growth in institutional and B2B income during the year. It seems its Neobank API partnership is leading to significant new account openings and trading activity.

Bullish outlook

While all of the above is encouraging, the outlook was perhaps the most exciting part of the results. Here, the company said that it has reached a “key inflection point,” with institutional and B2B partnerships providing access to large embedded client bases and enabling “growth at scale.”

It expects the next 12 months to be a “defining period” as it rolls out a multi-asset super app. In terms of numbers, net operating income is expected to rise by at least 17% year on year in the current financial year.

Consider buying on a pullback

Now, the share price has popped today (up 17% as I write) after these excellent results. So, it might not be smart to pile into the stock this minute.

But if it pulls back a little, I think it’s worth considering. As I said, this is a very scalable company.

Meanwhile, the valuation isn’t high. Assuming 15% growth in EPS next year, we are looking at a price-to-earnings (P/E) ratio of around 14.

Of course, competition from the likes of Robinhood (I hold this stock), Trading 212, and Freetrade is a risk. Overall though, I see a lot of appeal.

Should you invest £5,000 in Cmc Markets Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Cmc Markets Plc made the list?

Edward Sheldon owns shares in Robinhood Markets

The post CMC Markets: a FTSE dividend star worth considering for an ISA or SIPP? appeared first on The Twelfth Magpie.

Here, I’m going to highlight a cheap FTSE 250 dividend stock that I like the look of right now. It’s outperforming a ton of blue-chip names this year, so could it be worth a look?

A hidden gem in the FTSE 250

The stock in focus here is CMC Markets (LSE: CMCX). It’s a leading provider of investment and trading platforms.

Founded in 1989, it operates in 12 countries today. Globally, it has over 2m traders and investors on its platforms.

Now, I last covered this FTSE 250 company in March. At the time, I was quite bullish on it.

Since then, its share price has jumped about 12% to 372p. But I don’t think it’s too late to consider getting involved here as the fundamentals look very strong at the moment.

A great business model

The beauty of this company is that it can do well when markets are rising and when they’re falling. When they’re rising (as they are now), people want to trade in order to capitalise.

However, when they’re falling, people also want to trade. Some traders will look to close out positions to reduce risk while others will look to buy on the dip.

Another thing to like about it is that it’s doing white label deals with other financial services firms. For example, it recently signed a major deal with Australian bank Westpac (and as a result is now Australia’s second-largest stockbroker).

These kinds of deals offer a new source of growth. Note that late last year the company said that further partnerships were at an advanced stage (we might get more details on these when the company reports later this week).

Attractive financials

As for the financials, they look good. Revenue is rising – for the year ended 31 March analysts expect £392m versus £288m three years earlier.

Meanwhile, return on capital employed – a key measure of profitability – is very high. And the balance sheet is strong.

How’s the dividend yield?

As for dividends, they’re attractive. For the financial year recently ended, analysts expect a payout of 14.7p per share.

That translates to a yield of nearly 4%. Note that dividend coverage is expected to be high so there could be scope for decent increases in the years ahead.

The valuation

Zooming in on the valuation, it’s quite low. With analysts expecting earnings per share of 28.1p for the year recently ended, the price-to-earnings (P/E) ratio is only 13.3.

I see value on offer at that earnings multiple. In my view, the stock is a bargain today.

Worth a look?

Now, of course there are risks here. Probably the biggest one is competition from rivals.

This is a competitive industry. And new players like Robinhood (I own shares here) are aggressively trying to capture market share.

I like the risk/reward set-up, however. In my view, this dividend stock is worth a closer look.

But it’s not the only dividend payer that looks interesting to me right now…

Should you invest £5,000 in Cmc Markets Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Cmc Markets Plc made the list?

Edward Sheldon owns shares in Robinhood Markets

The post £1,000 buys 268 shares in this dirt-cheap dividend stock that’s on fire in 2026 appeared first on The Twelfth Magpie.

Interested in learning more? Here’s a look at two of these stocks.

Rising while the market is falling

One group of companies that often does well when market volatility picks up is financial trading businesses. The reason they tend to outperform is that volatility creates trading opportunities – when markets are swinging around wildly, customers want to place more trades.

Now, one of my favourite UK stocks in this space is IG Group (LSE: IGG). I’ve highlighted this name a few times recently as an undervalued growth (and income) play.

It’s having a great run at the moment. This week, it actually hit new all-time highs.

Relative to the FTSE 100 (which it’s set to join at the end of this month), it’s outperforming by a wide margin. Over a month, it’s up about 6% versus a 6% fall for the index.

Even near all-time highs, I still see a lot of appeal in the stock. Because it still looks relatively cheap (the forward-looking price-to-earnings ratio is only 12) and offers an attractive dividend yield (3.1%).

Meanwhile, the company is performing well and just announced a strategic review to ensure it captures the full long-term opportunity ahead. “We operate in large and fast-growing markets being reshaped by structural drivers, and now is the time to raise our ambitions,” said the firm in an update.

It’s worth pointing out that IG operates in a competitive market. Players it’s up against include the likes of Robinhood and Trading 212.

It seems to be holding its own amid the growing level of competition, however. So, I think it’s worth considering for a portfolio.

Near 52-week highs despite market weakness

Another company in this industry that could be worth a look though is CMC Markets (LSE: CMCX). It offers similar services to IG but is significantly smaller (it’s in the FTSE 250 index).

It’s not at all-time highs at the moment. But it is near 52-week highs, meaning that pretty much everyone who bought shares in the last year is now in positive territory.

I see a lot of appeal in this name too. Like IG, it’s cheap (the P/E ratio is 11.5) and sports an attractive yield (4.4%).

It also has momentum at the moment. Recently, it has done some major white label deals that could massively boost growth (one of these was with Australian banking giant Westpac).

Again, competition is a risk. These days, traders and investors have a lot of choice when it comes to platforms.

With a below-market-average valuation and an above-average yield, however, I like the risk/reward proposition. In my view, this stock is worth a closer look right now.

The post As the FTSE indexes sink, these unique dividend shares are making investors money appeared first on The Twelfth Magpie.

Yet that return looks rather pedestrian relative to the gains generated by a financial stock in the FTSE 250 index. With this stock, investors could have picked up another 20 percentage points or so.

A hot stock in the FTSE 250

The one I’m talking about is CMC Markets (LSE: CMCX). It’s a leading online trading and investment business.

Founded in 1989, it operates in 12 countries today. Services offered include stock and ETF trading (commission-free in many cases), FX trading, spread betting and contracts for difference (CFDs) trading, and white label solutions for other companies.

At present, CMC shares trade for £3.27. That means £1,000 buys around 305 shares (ignoring trading commissions).

The stock – which is up almost 60% over the last year – may not be at these levels for much longer though. I reckon it may only be a matter of time until investors spot the opportunity here.

The investment opportunity

Looking at the set-up, there’s a lot to like about CMC shares, in my view. For a start, the company is well placed to benefit from volatility in the stock market (which is picking up as a result of several factors).

When markets become volatile, investors and traders tend to place more trades. This translates to more revenue for the company (which takes a slice of every transaction through a spread between buy and sell prices).

Second, the company has recently done some white label deals that could massively boost growth. One such deal was with Aussie bank Westpac (one of the big four banks in Australia).

This is expected to increase the company’s user base significantly. And it should cement the company as the country’s second largest stockbroker.

I’ll point out that I’ve used the company’s investment platform in Australia and it’s really good. With commission-free trading on offer for Australian share trades under $1,000, and zero fees for US stock trades, it’s very cost effective.

Third, the valuation looks attractive. Currently, the forward-looking price-to-earnings (P/E) ratio is only 11.6.

That multiple looks too low to me. To my mind, there’s definitely scope for a valuation re-rating at some stage.

Finally, the company is hiking its dividend. In November, it lifted its H1 payout by a whopping 77% to 5.5p per share.

For the current financial year, analysts expect a payout of 14.7p per share. That puts the dividend yield at about 4.5%.

Worth a look?

Now, of course, there are risks here. One is competition.

Today, this area of financial services is intensively competitive. One rival to keep an eye on is Robinhood Markets (I just bought shares in this firm), which is having a huge amount of success at the moment.

Another risk is regulation. In the future, regulators could decide to clamp down on higher-risk products like CFDs.

Overall though, I see a lot of potential. I think this FTSE 250 stock warrants further research.

The post £1,000 buys 305 shares of this red hot UK financial stock that’s smashing Lloyds appeared first on The Twelfth Magpie.

Running for safety

During Q1 2020, the FTSE 100 fell by 25.4%. In comparison, Fresnillo (LSE:FRES) rose by 3.5%. The precious metals miner saw strong demand as gold and silver prices surged. Investors sought safe-haven assets during periods of market stress, with precious metals having a strong historical track record of outperforming.

The intriguing part of buying Fresniollo as a defensive pick is that whatever the cause of the next crash might be, it’ll likely trigger a similar move to buy precious metals.

In some cases, mining stocks can outperform the metals’ price. This is due to the operational leverage that Fresnillo (and related companies) have. What I mean by this is that if the price of silver jumps 10% tomorrow, Fresnillo can immediately benefit from a higher selling price. Yet the cost of extracting the metal hasn’t changed from the previous day. So it can increase output, enjoy the higher revenue, and also enjoy higher profits in the short term due to fixed costs of production.

However, Fresnillo is a volatile stock. As the share price is correlated to commodity prices, it can experience sharp swings both higher and lower. It’s up 412% in the past year, but with a price-to-earnings ratio of 147, some might understandably see it as overvalued at the moment.

Benefitting from volatility

Another stock to consider is CMC Markets (LSE:CMCX). During Q1 2020, it rallied 22%. This was primarily due to the high market volatility, which drove a surge in retail trading activity. Given that CMC operates a retail trading platform, it was able to capture and benefit from these higher volumes. Profitability increased as it makes a small commission on each trade, so the more trades that occur, the more money it makes!

Again, I think this could do well regardless of the cause of the next crash. Irrespective of the catalyst, we’ll likely see higher volatility in both stocks and other asset classes. CMC has a broad product range that can be traded, suggesting it should outperform as client activity increases.

Further, it’s now a larger company than back in 2020. It’s expanded different partnership agreements, and in the latest half-year report noted that of the new account openings, “around 70% of these accounts are from European countries where we have no physical presence.”

One risk is higher competition. Other platforms catering to the same crowd have popped up in recent years, putting pressure on CMC to maintain market share.

Even with the concerns, I think both stocks are worthy of consideration by investors right now.

The post 2 stocks to consider buying that outperformed during the last stock market crash appeared first on The Twelfth Magpie.