Closing on Friday (29 May) at 10,409.28, the UK blue-chip index is down 500 points from its all-time high on 27 February, the day before the Iran conflict began. So, what comes next?

What’s sustaining stock markets?

US markets rallied late on Friday after US President Donald Trump announced plans to lift the US blockade of crucial shipping lane Strait of Hormuz, as part of a peace deal. Brent crude plunged to $91 a barrel, the lowest in six weeks. That’s down from a peak of $118 on 29 April.

Personally, I think investors are getting ahead of themselves. Tehran is taking a hardline. Tanker traffic remains disrupted, inventories are shrinking, and Middle East production is still down.

Geopolitics isn’t the only thing driving markets. June brings the biggest IPO in history, when Elon Musk’s SpaceX floats. The excitement could reverberate across the market. While also triggering more talk of a tech and AI bubble.

I’m bracing myself for a bumpy summer, while staying alert for the many FTSE 100 buying opportunities it may throw up. We may be staring one in the face right now.

Is this beaten-down share worth considering?

The single worst FTSE 100 performer of the last three months is private equity specialist 3i Group (LSE: III). That’s terrible news for me, because until recently it was my biggest and most successful position. Not today, sadly, with the shares down 45% over the last year.

I did see the trouble coming. Investment trust 3i has been running a portfolio of companies since 1946, buying businesses, building them up, and selling them on. Yet, one of its purchases has been so successful, it now dominates the whole operation, making up more than 70% of the total 3i portfolio.

The company is non-food discount retailer Action, which has more than 3,300 stores across Europe. My concern was that its breakneck growth only needed to slow slightly for 3i to be punished. And that’s exactly what’s happened.

Can Action crack America?

On 14 May, Action reported a 14% rise in Q1 net sales to €4.01bn. Unfortunately, like-for-like sales growth slowed from 6.8% to 2.4%. Cooler weather, tougher comparisons, and the Iran conflict were blamed. Even a £750m share buyback couldn’t lift the mood. That’s the problem with setting high expectations.

But here’s the exciting bit. For years, 3i traded at a premium to net asset value. Now it’s at a massive 25% discount. The trailing dividend yield has climbed to 3.7%. The froth has gone, and I think it’s well worth considering today. It may remain volatile though, and could take some time to turn downbeat investor perceptions around. Much rests on Action’s ambitious plan to crack the famously tricky US market. But its recent fortunes show that even without a crash, there are still some tempting bargain opportunities out there.

Should you invest £5,000 in 3i Group 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 3i Group Plc made the list?

Harvey Jones owns shares in 3i Group.

The post Will the FTSE 100 crash in June? appeared first on The Twelfth Magpie.

The shares are down about 31% so far in 2026, making them one of the biggest fallers in the FTSE 100 this year.

For patient, income‑minded investors though, I think that kind of slump can be exactly where bargains hide.

So is this just a warning sign – or a rare 30%-off sale on a high-quality compounder?

A spectacular track record

When I look past the share price, the long‑term growth and income story still looks very impressive to me. Over the past decade, 3i’s delivered annualised revenue growth of 12.3% and boosted dividends at an annual rate of 26.4%.

That’s a remarkable record for anyone targeting passive income. And this year, the board recommended a total dividend of 84.5p, up from 73p the year before.

Looking ahead, forward estimates point to earnings per share (EPS) growing by around 6.8% a year, suggesting confidence in ongoing operations.

Recent results back that up. For the year ended 31 March, the group reported a total return of £5.3bn, equal to a 22% return on equity (ROE). Meanwhile, net asset value (NAV) per share rose from 2,542p to 3,030p.

So why the falling price?

The elephant in the room

The reason’s simple: roughly three quarters of 3i’s value is tied to a single asset, Dutch discount retailer Action. With 3,000‑plus stores across Europe, it focuses on huge volumes rather than fancy margins.

Unfortunately, its recent numbers were less than spectacular. In 2025, like‑for‑like (LFL) sales growth fell sharply, from 10.3% to 4.9%. That scared off investors, prompting the capital flight.

Management has blamed cooler weather and softer consumer sentiment in France, plus lower traffic in Germany, for the slowdown in LFL growth.

As AJ Bell’s Dan Coatsworth put it: 

Shares in FTSE 100 investment trust 3i Group crashed 19% after the company paid the price for being too reliant on a single holding. 

So if the hype’s subdued for now, could that be exactly when long‑term buyers should start paying attention?

Is it too risky?

Action’s still growing sales in the mid‑teens and generated €16bn of revenue in 2025 with an operating EBITDA margin of 14.8%, which is hardly a broken business.

It’s just no longer hitting the eye‑watering double‑digit sales investors had become accustomed to. In my opinion, that looks more like a reset in expectations than a collapse in the model.

Long story, short: investors might be throwing out the baby with the bathwater here.

The bottom line

3i still looks well-managed, with low gearing of around 2% and healthy cash generation across the wider portfolio.

But if Action’s results keep disappointing, sentiment could stay sour and the share price could fall further before it recovers. There’s no guarantee that French and German trading will bounce back quickly, and competition from other discounters is fierce.

Still, a one‑third share price fall combined with a long record of rising revenues and dividends is hard to ignore. In this instance, I’m prepared to accept the concentration risk and have trust in a recovery.

So while others rush for the exit, I plan to buy more shares in the coming months.

Should you invest £5,000 in 3i Group 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 3i Group Plc made the list?

Mark Hartley owns shares in 3i Group

The post One of my favourite UK shares is down 31% this year. Am I crazy to buy more? appeared first on The Twelfth Magpie.

Asking me to name my favourite Buffett quote is like asking a chef to pick a favourite ingredient. But if I had to list my top three, this would be it:

1. “Be fearful when others are greedy, and greedy when others are fearful.”
2. “Only when the tide goes out do you discover who’s been swimming naked.”
3. “If you aren’t willing to own a stock for ten years, don’t even think about owning it for ten minutes.”

Reading these simple words and thinking deeply about what they mean can make us all better investors. Both in terms of making money and not losing a lot of it.

The stock market is the world’s strangest store

However, the quote I’m referring to in the title is this one: “If you plan to eat hamburgers throughout your life and are not a cattle producer, should you wish for higher or lower prices for beef?”

Buffett says the question answers itself. Yet most people act differently in the stock market. When prices rise a lot, they become elated, and when prices tank, they get depressed.

But that’s the wrong way round for a net buyer of stocks. Or put another way, the stock market is the only place where people dash out of the shop when everything goes on sale.

Why is that? I mean, when I go to Tesco and see my favorite coffee brand marked down from £6.50 to £4, I don’t panic. I don’t think, “oh no, the value of coffee is collapsing, I must throw all my jars in the bin at home” and don’t run out of the store.

Instead, I probably just pop a jar in my basket to take advantage of the sale. 

Buying at a lower price

Of course, this is not entirely an apples-to-apples comparison because a stock may deserve to suddenly have a lower share price. The firm may be losing its competitive position, for example, or facing some catastrophic regulatory change. 

But assuming all else is equal, quality merchandise trading at lower prices should get investors more interested, not less. 

Let me give a recent example. I own shares of 3i Group (LSE:III), a private equity firm from the FTSE 100. It has a tremendous track record of buying stakes in businesses and helping them grow before realising a profit.

Earlier this month, 3i nosedived because its top holding Action (the Dutch discount retailer) reported slowing growth. And because 3i had applied a certain valuation multiple to its (unlisted) investment, the market essentially marked one down through the other. A further slowdown in growth is a risk.

However, I recently took advantage of this because a 27% disconnect has emerged between the 3i share price and what the investment firm thinks its underlying net asset value is. As a result, it’s just launched an aggressive £750m share buyback.

On top of this, there’s a 4.2% forward dividend yield, while the rest of the portfolio beyond Action is performing well. My view is the stock is on sale and worth considering.

Should you invest £5,000 in 3i Group 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 3i Group Plc made the list?

Ben McPoland has no position in any of the companies mentioned. 

The post Understanding this Warren Buffett quote can help you build stock market wealth appeared first on The Twelfth Magpie.

3i shares are still falling on Monday (18 February), down 7% in start-of-week trading. Yet I’ve always been a fan of this investment trust, and believe it still has brilliant long-term opportunities ahead.

And at current prices, I think it’s worth serious attention from bargain hunters. Could it be one of the FTSE 100’s best value stocks?

So what’s happened?

3i invests a lot in US private equity, and has its fingers in many pies. The 50+ companies its portfolio specialise in areas as diverse as pharmaceuticals, infrastructure, business software and retail.

The problem? Roughly three-quarters of 3i’s capital is actually tied up in Dutch value retailer Action. And things there appear to be going from bad to worse.

3i actually put in a pretty solid performance in the financial year that ran to March. Last Thursday’s (14 May) full-year release showed net asset value (NAV) per share up 19% year on year. The trust also delivered a juicy total shareholder return of 22%.

But Action was a drag on the broader portfolio, with like-for-like (LFL) sales growth cooling to 4.9% in 2025 from 10.3% the previous year.

And things have remained tough since with LFL growth dropping to 2.4% in the first 19 weeks of 2026. It was a far stronger 6.8% in the same period last year. 3i says trading at the European retailer has been impacted by

cooler weather in recent weeks against high comparables last year [and] continued consumer caution in France and lower traffic in Germany.

What next?

I’m not expecting things to improve any time soon. Pressure is rising as the Iran War continues, hitting consumers in the pocket as inflation increases.

This in turn leaves 3i’s share price in danger of further sharp falls. Analysts at RBC Capital note that “Action has left itself with a lot to do in H2 to meet its guidance.” Any cuts to forecasts could see the share price slump again.

But then the trust is now so cheap, could the market be pricing in this possiblity? I think it might. At £20.69 per share, 3i trades at a near-30% discount to the NAV per share as of the end of March.

Stunning value

So is 3i one of the FTSE 100’s best bargain shares at current prices? There are clear risks, but I think it could be. RBC analysts consider the trust to be “a good, well managed business” and “Action… a high-quality retailer.”

Action’s recent performances aren’t terrible. It’s just that sales growth is now back around the average for value retailers following years of smashing the market average. In my view, the scale of 3i’s share price slump is hard to justify. And so I believe it’s worth serious consideration from savvy long-term investors.

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

The post Down 37% and still sinking! Is this now one of the FTSE 100’s best value shares? appeared first on The Twelfth Magpie.

Investing success is about getting the big decisions right. And earlier this week, I found myself wondering what Buffett would do…

What happened?

3i (LSE:III) issued its results for the 12 months leading up to 31 March on Thursday (14 May). And the stock crashed 24% when the market opened.

In this sort of situation, two bits of Buffett insight come to mind. One is the famous point about being greedy when others are fearful. 

Another thing Buffett advises, however, is the following:

“When you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.”

In other words, a falling stock isn’t automatically an opportunity. If there’s something wrong with the business, it’s best to get out as quickly as possible.

Buffett might favour holding investments forever. But it’s a fair point that his investment vehicle, Berkshire Hathaway, does sell shares when situations change.

So what should I do with my 3i investment? Is this a situation to seize the opportunity and buy more or to abandon ship before it gets worse? 

Results

3i’s results were – in my view – basically fine. The private equity firm increased its net asset value per share 19.19% to £30.30.

A big part of this came from Action, its largest investment. The retailer increased its store count by 13% and like-for-like sales by 4.9%.

Those are decent numbers. But the reason the stock crashed is that things don’t look so impressive going forward.

Like-for-like sales growth has fallen to 2.4% in the first 19 weeks of 2026. That’s a sharp decline and the main reason 3i shares crashed.

Trading has been especially weak in France and Germany since the start of the conflict in Iran. And that remains a risk going forward. 

There’s nothing Action or 3i can do about geopolitics. But, insofar as it can weigh on sales, it’s something investors need to be aware of.

What would Buffett do?

Action faltering has a big effect on 3i. That’s because the firm values its stake in the retailer on its balance sheet at a high multiple.

Fundamentally though, 3i’s unique strength hasn’t changed. It still – unlike other private equity firms – invests on its own schedule.

This is because it uses its own capital rather than raising funds from investors. So it can wait for the right opportunities.

That’s the foundation of the firm’s success and it’s still very much the case. So I think it’s clear what Buffett might do.

3i isn’t a chronically leaking boat. I think it’s a very good operation facing some near-term challenges that are weighing on its share price.

Given this, my way forward is pretty clear. I’m a buyer at today’s prices.

Buying ahead

I started buying 3i shares at a price-to-book (P/B) ratio of around 1.4. And I knew at the time that was probably a bit ambitious. 

My view was that the company would probably grow into its valuation within a couple of years. And I still think that. 

Today, however, the stock trades at a P/B ratio of 0.7. At that level, I see it as a greedy-when-others-are-fearful situation.

The post This FTSE 100 stock crashed 24% in a day. I asked myself what Warren Buffett would do appeared first on The Twelfth Magpie.

So how big does a portfolio actually need to be? And what’s the smartest way to build it?

Crunching the numbers

The average full-time salary in the UK currently sits at £39,039, according to the latest ONS data. That means to sustainably generate that as a passive income, following the widely-used 4% rule, an investor would need a portfolio worth around £975,975.

That’s a chunky sum. But here’s the thing, you don’t have to get there overnight. And for patient investors who start early, it’s more achievable than most people think.

Can a modest investor really get there?

A modest investor putting aside £500 a month and targeting the market’s long-run 8% average total return would reach that figure in roughly 33 years.

That’s obviously a long time. Yet for those willing to pick stocks directly and focus on quality compounders, that timeline can shrink considerably.

One stock that expert analysts have flagged as a high-conviction opportunity in May is 3i Group (LSE:III).

Fun fact: over the last decade, the FTSE 100 private equity giant has delivered an exceptional 22.6% annualised return. And anyone who’s been drip feeding £500 a month at this rate since 2016 is already sitting on £222,578. Give it another 10 years, and compounding would transform this into £2.3m!

These exceptional long-term returns are being driven by backing and growing businesses across Europe and North America. The most impressive has been Action, the discount retailer that has become one of the fastest-growing non-food retailers on the continent.

As 3i’s own management noted in its most recent results: 

“Action’s performance continues to exceed our expectations, with new store openings accelerating across Europe.”

That momentum has been a powerful engine for 3i’s net asset value and, by extension, its share price. But is the good news already priced in?

What could go wrong?

The bull case for 3i is hard to ignore. Action’s relentless store rollout shows no signs of slowing, with the business expanding into new territories and posting double-digit like-for-like net sales growth. For long-term investors, this is exactly the kind of quality compounder that can dramatically accelerate the journey towards financial freedom.

The bear case however, is equally real. 3i’s fortunes are heavily tied to one investment. If Action were to stumble, whether from a shift in consumer spending, rising competition, or execution mis-steps in new markets, the knock-on effect for 3i’s valuation could be severe.

There’s also the broader macro backdrop to consider. A global economic slowdown or tightening credit conditions could weigh on private equity valuations more broadly, even if the underlying businesses remain healthy.

The key question now is whether Action can maintain its remarkable growth trajectory as it pushes into new markets.

The bottom line

No passive income journey is risk-free. But for patient investors with a long time horizon, the stock market remains the most powerful wealth-building tool available.

Overall, I think 3i’s a compelling long-term compounder in the FTSE 100 right now. So for investors dreaming of ditching the 9-to-5, it’s a stock that’s worthy of a closer look.

The post How much do you need to put into the stock market to quit work for a life of passive income? appeared first on The Twelfth Magpie.

Now, I opened a smallish starter position in this investment trust recently. And because I build out my holdings over time, I actually prefer the share price to fall while I’m doing this. 

Because as Warren Buffett once pointed out: “Only those who will be sellers of equities in the near future should be happy at seeing stocks rise. Prospective purchasers should much prefer sinking prices.”  

The exception to this is if the business runs into serious trouble. With the stock crashing today, is that what’s happening with 3i?

A strong year 

3i Group was founded in 1945 to help rebuild Britain after the Second World War. It specialises in private equity and infrastructure, often taking controlling stakes in mid-sized companies then helping them grow through buy-and-build strategies and international expansion. 

Today, the company released its results for the year to 31 March. At first glance, they looked strong, with net asset value (NAV) per share increasing to 3,030p from 2,542p a year earlier. 

Net assets surpassed £30bn, driven by growth at Dutch discount retailer Action and Royal Sanders, a leading European contract manufacturing producer of personal care products.

Elsewhere, 3i saw “a number of standout performers” across the portfolio. Indeed, the firm harvested £1.9bn of cash proceeds from it last year.

And the £20bn trust is in a strong financial position, with liquidity of £1.86bn and net debt of £547m. Gearing was low at just 2%.

Why’s the stock crashing then?

The problem is that 3i’s portfolio is dominated by Action, which is a cross between B&M and Home Bargains. It’s the sort of place you pop in for shampoo and leave with a new toaster and garden gnome.

The retailer’s previously torrid pace of growth has been slowing across Europe. Like-for-like (LFL) sales dropped to 2.4% in the first 19 weeks, down from 6.8% last year. LFL sales were flat in France, its largest market, and Germany. 

Management put this down to consumer caution, recent cooler weather, tough comparables, and seasonal product categories that underperformed. Inflation, driven by the unresolved Iran conflict, is adding to near-term uncertainty. 

However, 3i is very confident in the retailer’s future. CEO Simon Borrows said:

[Action’s] growth story is underpinned by the combination of a powerful, multi-year, store roll-out programme into significant white space potential and compounding in LFL sales growth, with some of the best store economics we have seen in a retail concept.

Is this the best value stock? 

3i has been applying quite an aggressive 18.5 times enterprise value-to-EBITDA (earnings before interest, tax, depreciation, and amortisation) multiple for Action. This implies a near-30% NAV discount. 

Even accepting a lower multiple to account for slowing growth, there still seems to be a margin of safety here. There’s also a 3.9% dividend yield. 

On top of this, 3i has announced a £750m share buyback programme to be completed before the end of the year. Directors have also been snapping up the stock recently. 

While this might not prove to be the FTSE 100’s best value share, it’s one of them, in my opinion. So I’ll be adding to my 3i position soon. 

The post Down 33% year to date. Is this now the best value stock in the FTSE 100? appeared first on The Twelfth Magpie.

The 3i share price plunged another 19% this morning as full-year results disappointed. The shares peaked at 4,447p last October. Today, they’re at 2,014p, a drop of 54%. As ever when a portfolio holding suffers a sharp reversal of fortunes, I ask myself the same question: should I buy more?

Is this an unmissable FTSE 100 buying opportunity?

That may sound crazy and counter-intuitive, but buying on the dips can pay off nicely over the longer run. Suddenly, there’s a hefty discount on offer. Inevitably, there are risks too. Worse, I saw those risks coming.

3i has been running a portfolio of companies since 1946, buying businesses, funding them, building them up and selling them on. Today, it’s largely a play on its most successful holding, European non-food discount retailer Action.

The chain has spread rapidly across the continent and now has more than 3,300 stores. It also makes up roughly 70% of the overall 3i portfolio. That’s a lot of concentration risk. My other worry was that Action had grown so quickly that even the slightest hint of slowing momentum would be punished. That’s exactly what’s happened.

We got the first warning shot last year. French growth slowed, 3i shares slumped. Today’s results for the year to 31 March repeated the pattern.

If you’re expecting a disastrous set of figures or a profit warning, you’d be wrong. 3i actually reported a 19% increase in diluted net asset value per share to 3,030p. It also announced a £750m share buyback. Chief executive Simon Borrows hailed “another good year”. So what’s the problem?

Total return on opening shareholders’ funds jumped 22%, but that was down from 25% last year. Action’s net sales rose a solid 14% to €4.01bn in the first three months of 2026. However, like-for-like sales growth slowed from 6.8% to 2.4%. Cooler weather, tougher comparisons and Iran concerns were to blame. Stores in France and Germany struggled. The excitement has ebbed.

Has the sell-off been overdone?

I’m not going to sell my stake. These are difficult times for consumer-facing shares as inflation flares up, and I expect 3i to recover over the next few years. I do regret becoming overexposed, though. It had grown into my biggest single portfolio holding. Alas, no longer.

Now here’s what I think is the biggest attraction. In recent years, the investment trust traded at a hefty premium to underlying net asset value, often as high as 15%. Today, it’s at a 21% discount. The next year could be bumpy, but I’ll be watching 3i closely. Instead of selling, I’m tempted to buy a little more. This stock once looked expensive. It doesn’t today.

The post My favourite UK stock just plunged 19% — is it now a screaming buy? appeared first on The Twelfth Magpie.

As the world faces the biggest energy shock in its history, I’d have expected global share prices to have gone into meltdown weeks ago. But they haven’t. So why are the FTSE 100 and other indexes holding firm?

Share prices have certainly been volatile. But the UK’s blue-chip index is still up 3.75% so far this year, and 20% over 12 months. I think that’s pretty solid, given the scale of the threat.

So why haven’t share prices tumbled?

Just a few months ago, oil traded at around $60. Today, a barrel of Brent crude costs $107. In the past, dramatic shifts like that have triggered recessions and worse. Yet every time markets dip, they quickly recover. Investors have shown their resilience lately, shrugging off Covid, Ukraine, US tariffs and now war in Iran. They’re holding the line today even with the crucial Strait of Hormuz oil supply route still closed.

So far, we’ve avoided oil shortages in the West, by drawing down inventories and strategic reserves. But we can’t do this forever. If supply tightens, the market crash could still come, and I’ll be watching closely, waiting for a buying opportunity. But there’s one thing investors can do today.

And that’s to scour the FTSE 100 for top UK stocks that have taken a beating lately, and offer lower valuations and higher yields as a result. These five have been hit hard over the last three months.

I’ll be exploring all of these opportunities in the days ahead but right now I’m particularly intrigued by 3i Group (LSE: III) because I hold it. In fact, until recently, it was a portfolio star, having doubled my money in just over two years.

Can this FTSE 100 stock make a stellar recovery?

3i is a private equity specialist with a track record dating back to 1946. Lately, it’s been the vehicle for a single staggeringly successful holding, European non-food discount retailer Action. The chain now boasts more than 3,300 stores across Europe, attracting 2.6m customers every week.

Action’s sales grew another 16.1% to €16bn in 2025 but investors were starting to get nervous even before recent geopolitical uncertainty, fearing it would struggle to maintain its breakneck growth. Investors were in two minds over plans to move into the US, a famously tough market to crack.

But here’s why I’m highlighting it now. Before the sell-off, the investment trust was trading at a massive premium of 29% to underlying net asset value. Today, investors can buy it at a 15% discount. Also, the dividend yield has crept above 3%. 3i directors have been pouring their own money into the stock. I’ve taken advantage of recent dips too.

If markets do crash, 3i Group shares could fall even further, but I think they’re well worth considering today. Let’s see what summer brings. Will you be joining me in monitoring 3i’s progress?

The post Is a summer stock market crash now inevitable? appeared first on The Twelfth Magpie.

The FTSE 100 has been volatile but overall it’s climbed 4.15% so far in 2026. Over 12 months, it’s up an impressive 20.5%. With dividends reinvested, the total return nears 25%. Yet investors remain tense and understandably so.

The world faces the biggest oil shock in history, according to the International Energy Agency. If the Strait of Hormuz tanker route remains closed, Macquarie Group warns oil could hit $200 by the summer. It’s a Bank Holiday today (4 May), and the UK market is closed. What can we expect when it reopens tomorrow? It coudl go down, up or not do much at all. But the thing is, I’m not worried whatever it does.

What will I do in a meltdown?

Brent crude peaked at $124 a barrel last week. Today, it’s down to $109. Sentiment has been boosted by Donald Trump’s pledge that the US will guide ships through Hormuz. He also said talks with Iran have been “very positive” and could lead to broader de-escalation. If that holds, the FTSE 100 could jump tomorrow. But a fresh setback could trigger the long-feared crash. It’s hanging in the balance.

Second-guessing market movements is pointless though. Instead, I’m targeting buying opportunities as they emerge. And I can see plenty of compelling buys both in the event of a meltdown and today when one hasn’t actually happened. One of them is FTSE 100-listed private equity firm 3i Group (LSE: III).

The investment trust has a track record stretching back to 1946, when it was set up to help small and medium-sized British businesses secure long-term capital for reconstruction and expansion. Today, 3i takes controlling states in mid-market companies, managing them to generate sustainable growth and returns for shareholders.

One company has done so well it’s now worth 70% of 3i’s entire portfolio. Non-food discount retailer Action is growing rapidly in Europe, expanding steadily and managing thousands of stores. In 2025, net sales climbed another 16.1% to €16bn. Now 3i is gearing up to crack the US, which would take it to a different level.

Ready for a big recovery?

Despite Action’s stellar success, 3i shares have fallen 22% in the last three months, and 40% over the year. Personally, I think they rose too far, too fast. Action’s sales growth has to slow at some point. Many investors may also be wary of US expansion plans, as it’s a tough market to crack.

3i has also been hit by wider stock market uncertainty. The stock tends to fall faster than the index on bad days, and climb faster on good ones. But here’s the exciting bit, in my view. The investment trust now trades at a 15.8% discount to the underlying value of its net assets. For years, it traded at a premium. I think it’s well worth considering for investors up for the challenge. I’ve taken advantage of recent dips to buy more myself. So have 3i’s directors.

History shows that even if we do get an outright crash, it won’t last forever. Whatever happens next week, I’ll be watching closely to see which shares emerge as the best bargains.

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