The year began with a burst of optimism, as investors looked forward to falling interest rates. These typically boost the economy by cutting consumer and business borrowing costs, giving everyone more money to spend. Equities tend to do well in that scenario, as investors anticipate rising company revenues and profits.

That expectation flipped in March, as the Iran war drove up the oil price and inflation. Expectations have since flipped though as peace talks drive oil back down. Markets are flying again.

Has this been a good year for shares?

Here’s how the three major global indices have done in 2026:

• FTSE 100: 7.36%
• S&P 500: 9.11%
• MSCI World Index: 9.94%

While the FTSE 100 has the lowest headline return, it has the highest yield at 3.3%. The S&P 500 yields just 1.1%, and MSCI World around 1.35%. So here’s the total return, including dividends. The FTSE 100 now beats Wall Street.

• FTSE 100: 10.66%
• S&P 500: 10.21%
• MSCI World Index: 11.29%

Finally here’s what they’d have done to a £15,000 investment, including dividends.

• FTSE 100: £16,599
• S&P 500: £16,531
• MSCI World Index: £16,693

Remember, this is just the six-month return. The real rewards from investing come over time periods measured in years and decades.

Today, it’s possible to get around 4% on an instant access Cash ISA. So savers could have got 2% so far this year. Which would have turned £15,000 into a more modest £15,300. Cash ISAs help savers avoid the volatility of equities, but over the longer term, they won’t make your money work as hard.

Polar Capital shares have seriously outperformed

Buying individual stocks can turbocharge returns, although the risks are greater too. Polar Capital Technology Trust (LSE: PCT) has had a stunning year, rising a staggering 47%. That would have turned £15k into £22,050, ignoring charges.

This isn’t a flash in the pan. Its shares have rocketed 87% in the last year, and 182% over five. It doesn’t pay any income.

Polar Capital Technology is an investment trust that manages a portfolio of almost 100 global technology stocks. Its biggest holdings include Nvidia, TSMC, Broadcom, Micron Technology, Google-owner Alphabet and Apple.

I recently switched my profits from a passive tech tracker into the actively managed Polar Capital, because it had outperformed over almost every investment timeframe. The charges are slightly higher but still modest at 0.69%. Yet today is a tricky time for investors considering upping their exposure to tech. The gains have been colossal, and many fear they could be unsustainable.

Will the AI bubble burst?

The big worry is that AI hyperscalers will fail to get a return on the billions they’re pouring into infrastructure, and the whole thing will come crashing down. On the other hand, this isn’t like the late 1990s dotcom boom. US tech giants are making profits. Well, most of them are.

No serious investor can afford to ignore US tech but at today’s dizzying valuations, it might be worth drip feeding money into the market. As ever, nobody knows what the next six months might bring.

Should you invest £5,000 in Polar Capital Technology Trust 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 Polar Capital Technology Trust Plc made the list?

Harvey Jones owns shares in Nvidia and Polar Capital Technology Trust.

The post How much is £15k put in an ISA at the start of 2026 worth today? appeared first on The Twelfth Magpie.

Who’s going to ‘go away in May’ when tech stocks are soaring and SpaceX is about to launch the biggest IPO in history? Here are three ways investors could get a piece of the action.

Scottish Mortgage

Scottish Mortgage Investment Trust (LSE: SMT) has long been an ISA favourite, and it’s held SpaceX stock for a lengthy period. With the book value of SpaceX climbing over the years, it now makes up 18% of the entire portfolio.

The IPO will finally put a market valuation on the stock — and I’m 50/50 on which way I think it might go. Most of the IPOs I’ve watched have fallen in value in the first year of trading.

SpaceX does weight the trust’s assets quite heavily, so might we see the holding trimmed for a bit of balance? The shares will be subject to some lock-up restrictions. But Scottish Mortgage recently said “We will continue to assess concentration and portfolio construction as we would with any listed holding“. So… that’s a maybe?

Polar Capital

Polar Capital Technology Trust (LSE: PCT) has been a popular Stocks and Shares ISA buy of late too. It might not hold space stocks directly. But it is keyed firmly to the thing that’s really driving SpaceX (and Tesla, and others). That’s AI, and it firmly backs Elon Musk’s talk of launching huge numbers of orbiting AI data centres.

The enthusiasm is not lacking. But how far away such an achievement might lie, even if it does work out as feasible and cost-effective, remains to be seen.

Meanwhile, Polar Capital is especially big in semiconductor makers. Nvidia is its number one holding, with Taiwan Semiconductor, Broadcom, Advanced Micro Devices, and Samsung Electronics all among the trust’s top 10 holdings. And there’s plenty of earthly demand for those.

Seraphim Space

How is investor enthusiasm for pure space research? We need look no further than Seraphim Space Investment Trust (LSE: SSIT) to see. Its 2026 share price spike might have fallen back a bit. But we still see a 77% gain so far this year.

The company says: “Our entrepreneurs see the infinite possibilities of space and transform those possibilities into game changing companies. Our portfolio companies are at the frontier of tomorrow shaping a better future on Earth.”

They’re mostly companies I’ve never heard of, I have to say — Iceye, D-Orbit, HawkEye360, and many more. So I’d have to dig fairly deeply into them before I’d consider investing. But, even though this investment trust is 100% invested in space, I do see diversification among different technologies and services.

Eyes in space, feet on the ground

It’s hard to get a handle on how soon today’s space exploration challenges might turn into the hoped-for big profits of the future. And space failures could mean investment flops. These are risky picks.

I rate Scottish Mortgage as probably the least risky, as it also holds down-to-earth stocks like Moderna and MercadoLibre. But for investors convinced the sky isn’t the limit, all three might be worth considering for a small portion of a Stocks and Shares ISA.

Should you invest £5,000 in Polar Capital Technology Trust 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 Polar Capital Technology Trust Plc made the list?

Alan Oscroft owns shares in Scottish Mortgage Investment Trust.

The post 3 possible ways to get a Stocks and Shares ISA into the new space age appeared first on The Twelfth Magpie.

Could these shares be the secret to retirement wealth? Let’s discuss.

Planning for a comfortable retirement

According to wealth management firm Quilter, an individual in the UK now needs a pension of £691,000 to retire comfortably. That assumes they’ll spend around £45,400 a year in retirement (no mortgage or housing costs) and will pocket around £12,500 annually from the State Pension.

Now obviously, £691,000 is a lot of money (it’s far more than most Britons have saved for retirement). And that figure’s what’s needed to retire today – those retiring in the future will need more money.

Are FTSE 100 shares the secret to success?

As for whether FTSE 100 shares can help Britons build up a big pension, I think they can. But really, they’re only part of the equation.

To build up a £691k+ retirement pot, the key’s to take a multi-pronged approach to retirement saving. By taking advantage of tax-efficient investment accounts and investing in different areas of the market to diversify and reduce risk, investors can give themselves a much better chance of financial success.

For example, when it comes to accounts, the Self-Invested Personal Pension (SIPP) is a brilliant retirement savings vehicle. Here, a £1,000 contribution is boosted to £1,250 by the government (this rate of tax relief is for basic-rate taxpayers – higher earners get more).

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.

Meanwhile, when it comes to investments, spreading money over FTSE 100 shares, UK small-caps, international shares, tech shares, and other areas of the market can pay off. Over the long term, a diversified global portfolio has beaten the Footsie.

A Footsie star worth checking out

There are definitely some gems in the FTSE 100 that are worth considering however. One stock that’s worth highlighting is Polar Capital Technology Trust (LSE: PCT).

This isn’t an individual company. Instead, it’s an investment trust that invests in lots of different publicly-traded businesses. As its name suggests, its focus is on the Technology sector. Stocks in the portfolio today include the likes of Nvidia, Alphabet, and AMD.

Overall, it holds around 100 different shares. About 60% of the portfolio’s allocated to the US while around 25% is allocated to Asia and Japan.

Huge returns

Why do I like this product? Two main reasons.

First, it’s a play on the global tech boom. In the years ahead, the world’s only likely to become more digital (AI, self-driving cars, etc), and this product offers exposure to the companies driving the revolution.

Second, it has an amazing track record. Over the last 10 years, it’s returned more than 25% a year versus around 7% for the FTSE 100 (remember though, past performance isn’t an indicator of future returns).

One other attraction is that it can be traded just like regular shares. So investors can be nimble and capitalise on intra-day weakness.

I’ll point out that tech stocks tend to be volatile. So it’s not the kind of product I’d consider going ‘all in’ on at once.

By regularly picking up a few shares in the trust on dips however, I think investors could do very well over time. In the long run, this trust has the potential to boost Britons’ retirement savings significantly.

Should you invest £5,000 in Polar Capital Technology Trust 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 Polar Capital Technology Trust Plc made the list?

Edward Sheldon owns shares in Nvidia and Alphabet

The post Britons need a £691,000 pension to retire comfortably. Could FTSE 100 shares be the answer? appeared first on The Twelfth Magpie.

Why? As AJ Bell analyst Dan Coatsworth says:

the UK stock market is cheap as chips and there are real bargains on offer. Certain companies are in the bargain bin for good reason, but there are also golden nuggets that have flown under the radar.

That comment may have been made way back last July. However, plenty of top-class Footsie shares continue to trade below value.

Take the following growth and dividend stocks:

• Barratt Redrow (LSE:BTRW).
• Polar Capital Technology Trust (LSE:PCT).

Want to know why they’re top bargain shares to consider?

Rock-bottom PEG ratios

Barratt’s forward price-to-earnings (P/E) ratio of 10.6 offers top value in my view. Though it’s the firm’s price-to-earnings growth (PEG) readings that really demand serious attention. These are:

• 0.1 for this fiscal year (to June 2026).
• 1 for next year.
• 0.4 for financial 2027.

Any reading below 1 indicates a stock trading below value. Combined with dividend yields of 5.5%-6.7% for the next three years, Barratt Redrow shares provide excellent all-round value.

So why is the housebuilder trading so cheaply? There’s no doubt risks have grown in 2026 after the Iran war began, raising inflation and likely leading to interest rate hikes. This has the potential to choke off the housing market’s fragile recovery.

Yet it’s my opinion Barratt’s ultra-low valuation more than reflects these risks. Besides, the long-term outlook for housing stocks like this is as robust as ever in my view, as the UK’s growing population drives demand for new homes. I’m confident this will underpin a strong share price rebound.

As the UK’s biggest builder by volume, Barratt is well-placed to seize this market opportunity too. Net cash sits at around £550m-£650m, giving the firm substantial financial firepower to do things like building its land bank. What’s more, its three different brands — Barratt (entry level), David Wilson (mid-market) and Redrow (premium) — help it effectively target different types of buyer.

A 9.4% discount opportunity?

While Barratt shares have dived, Polar Capital Technology Trust’s have rocketed. This reflects a rebound among high-growth US tech shares over recent months.

Yet Polar’s technology trust still offers excellent value. Why? Its shares trade at a 9.4% discount to the net asset value (NAV) per share.

Discounts like this can arise when investors sell a trust’s shares more aggressively than the underlying holdings. This could continue, if concerns over the economic landscape raises worries over holdings like Nvidia, Alphabet and Apple.

For me though, this discount reflects an attractive dip-buying opportunity. Polar Capital Technology Trust has surged 1,149% in value over the last decade, helped by its focus on market leaders with strong balance sheets and long records of innovation. I’m expecting it to keep rising as growth trends such as AI, quantum computing, robotics and cybersecurity gather pace.

Should you invest £5,000 in Barratt Redrow 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 Barratt Redrow made the list?

Royston Wild holds shares in Barratt Redrow.

The post Why are these FTSE 100 growth and dividend stocks so cheap? appeared first on The Twelfth Magpie.

Let’s take a closer look at the top three and consider whether there’s still time to join the party.

Hot!

Polar Capital Technology Trust seeks to “cut through the hype” often associated with the tech sector. To do this, it invests in businesses “playing on structural, secular trends”. Unsurprisingly, it only takes positions in companies that are fully embracing AI.

Around 30% of its £7.3bn portfolio is accounted for by the ‘Magnificent 7’, which goes a long way to explaining how its net asset value (NAV) per share increased by 102% during the year ended 30 April, compared to a 55% increase in the trust’s chosen benchmark, the Dow Jones Global Technology Index.

I think the trust’s an excellent way to get a foothold in the tech sector without having to decide who the long-term winners are going to be. Through one shareholding, risk is spread across 101 different companies. And it trades at a 7.5% discount to its NAV.

Despite its stellar run, I think there could be more to come. That’s why I believe it’s a stock that’s still worth considering.

Hotter!!

Antofagasta’s a copper miner based in Chile. And with the metal now an essential part of the manufacturing process for, among other things, electric vehicles and renewable energy infrastructure, the group’s benefitted from a 32% rise in the price of copper over the past year.

However, the price of copper is closely related to the health of the global economy. Any slowdown and earnings in the sector could be badly hit. Adverse exchange rate movements and political instability could also affect the group.

But for now, market fundamentals suggest copper prices are likely to remain at their historically elevated level. Set alongside its huge reserves, high margin, and strong balance sheet, Antofagasta could be one to consider for those prepared to add something at the riskier end of the scale to their portfolios.

Hottest!!!

Fresnillo, the Mexican gold and silver miner, has been the FTSE 100’s best performer over the past year, largely due to the price of these precious metals soaring 34% and 116% respectively.

But investing in the sector is risky. Volatile prices, production interruptions, and geopolitical instability are persistent threats.

However, I believe the long-term outlook for gold and silver is positive with both expected to be in supply imbalance. Central banks are the biggest buyers of the former as they seek to reduce their exposure to the dollar and hedge against expected higher inflation. Data centres and renewable energy are just two of the sectors helping to boost the demand for silver.

Personally, I think the recent pullback in the price of these two precious metals – both are over a third lower than their 52-week highs — makes Fresnillo a stock to consider. However, with erratic commodity prices fundamental to the group’s earnings, investors should be prepared for a bumpy ride.

Should you invest £5,000 in Polar Capital Technology Trust 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 Polar Capital Technology Trust Plc made the list?

James Beard does not hold any positions in the companies mentioned.

The post Hot, hotter, hottest. Is it too late to consider these 3 FTSE 100 shares? appeared first on The Twelfth Magpie.

Well, according to the Office for National Statistics, the median gross annual salary for someone aged over 60 in the UK is currently £37,804. Or the equivalent of £3,150 per month.

To earn this much from dividends each year inside a Stocks and Shares ISA would be a significant achievement, in my opinion. Remember, this figure would be tax-free, unlike the gross salary figure cited above (a fair chunk of which would usually be taxed).

So, how long could it take someone starting from scratch to reach this amount? Let’s dive straight in.

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.

An illustration

A portfolio of dividend shares yielding 5% would need to be worth just over £756,000 to throw off £37,804 a year. However, with a 6.5% yield, a £582,000 ISA would do the trick. That’s quite a big difference.

Either way, they’re not puny sums. But the good news is that it would take around 21 years to reach £582k by investing £700 per month.

I don’t think that’s a pie-in-the-sky target, for someone who is willing to prioritise long-term wealth creation.

However, this figure assumes three things:

• A 10% average annual return
• Dividends are reinvested (rather than spent)
• No platform fees are incurred during this period

In reality, a 10% return isn’t assured, while even ‘free’ investing apps come with some sort of cost. Meanwhile, dividends can be suspended or axed completely, as well as rise higher. So this is just an illustrative example.

Still achievable

That said, a 10% return isn’t out of the ordinary. It’s only slightly higher than the FTSE 100‘s annualised total return over the past decade (9.17%). The S&P 500‘s total return is even higher, at closer to 14%.

FTSE 100 trailing total returns (annualised)

What’s more, a wide variety of FTSE 100 stocks have delivered truly exceptional 10-year returns. These include Games Workshop (+3,827%), Diploma (+856%), Rolls-Royce (+392%), BAE Systems (+310%), 3i Group (+453%), and Antofagasta (+630%).

Of course, I’m cherry-picking some of the best performers here. But these are hardly secret stocks — they’ve been knocking about for decades!

Investing in the future

Sticking with the FTSE 100, a stock that I think is worth considering for the long term is Polar Capital Technology Trust (LSE:PCT). As the name suggests, it’s an investment trust focused on technology.

Let’s face it, the world is only going to get more digital in future, especially with game-changing technologies like AI and quantum computing advancing at a rapid pace. This trust offers wall-to-wall exposure through 96 holdings, including Nvidia, Alphabet, Taiwan Semi, Meta Platforms, and Broadcom.

The big risk to performance would be a sell-off in companies that are benefitting from the global AI buildout. However, it’s worth mentioning that the portfolio managers have their finger firmly on the pulse when it comes to emerging (and shifting) Silicon Valley trends.

As such, I feel the portfolio is in very good hands, with room to pivot away from danger if necessary. For example, its exposure to software, which has been under massive pressure due to AI disruption fears, is highly selective.

The post How much is needed in an ISA to target a £3,150 monthly passive income? appeared first on The Twelfth Magpie.

Like the dotcom bubble and previous bubbles before that, AI’s likely to burst too. But when it does, smart investors will swoop in to grab cheap shares before they rebound.

Consider Microsoft, for example. At the height of the dotcom frenzy, it was selling shares at almost $40 a piece. After it burst, they dropped to $12. It took some time, but by late 2014, they were back above $40.

Those who bought at the high made almost no profit, but those who bought the dip nearly quadrupled their investment.

Is AI the same?

Right now, AI stocks are reaching eye-wateringly high valuations, due to a ‘first-in-the-door’ frenzy. That can lead to unrealistic — and unsustainable — growth.

But even if the bubble bursts, the technology won’t go away — the shares will just get much cheaper. This is the opportunity. As implementations of AI eventually find real-life, profitable use cases, the market should begin to recover.

Is this a likely scenario?

Nobody can truly predict where the market’s headed. Even some of the most popular analysts have been wrong in the past about stock market crashes. And it’s fair to say that today’s conditions don’t exactly mirror the dotcom bubble. Still, it doesn’t hurt to prepare, especially when the signs are there.

Consider the following:

• AI’s pushed some big US tech and chip stocks to very high valuations.
• It’s concentrated in a narrow group of AI winners (mega‑cap platforms and semiconductor names).
• However, unlike 2000, most AI leaders are already highly profitable with strong cash flows.

So the main risk is concentration. If AI earnings or adoption disappoint, a de‑rating in a handful of giants could hit the market hard.

What this means for UK investors

The trick is picking the right shares. After the dotcom bubble, not every company recovered. Think Compaq, Pets.com and 3dfx — all went bankrupt or were sold to competitors.

This adds risk, as nobody can say for sure who will survive. But there’s a smart route that investors can take to reduce this risk — an AI-focused investment fund.

Grabbing a slice of the AI pie

Polar Capital Technology Trust (LSE: PCT) is a fund that invests in tech stocks, specifically those focused on AI. Top holdings include Nvidia, Alphabet, TSMC, Broadcom and Samsung.

It’s also one of the top-performing, UK-listed stocks over the past decade. Some estimates put its cumulative 10‑year total return at 9,707% (an average of 58.18% a year).

That’s a once-in-a-decade type of return that’s unlikely to happen again anytime soon — but it does suggest the fund’s managers know what they’re doing.

The caveat being that it’s highly concentrated in a single country (US) and sector (tech). This adds a high risk of loss if any major issues hit the US tech market.

Why I like it

The trust benefits from broad diversification in the tech sector, which removes the risk of loss from a single stock.

In short, UK investors can get exposure to a potential AI rebound without having to spend months researching every company. So for a moderate ongoing charge of just 0.77%, I think it’s well worth considering if the AI bubble bursts.

The post Don’t miss this once-in-a-decade opportunity to profit from the stock market’s AI hype appeared first on The Twelfth Magpie.

However, investors could have done far better with an investment trust that’s a constituent of the index. Over the last decade, this particular product has returned about 25% per year.

A brilliant long-term investment

The one I’m referring to is the Polar Capital Technology Trust (LSE: PCT). This is a tech stock-focused product run by London-based investment manager firm Polar Capital.

A decade ago, it was trading for around 55p. Today however, it has a share price of around 503p.

That means anyone who bought 10 years ago and held for the long term has made around nine times their money. That’s an absolutely brilliant return – it could have turned a £5,000 investment into around £45,000.

Worth a look in 2026?

Is this trust worth considering today? I think so.

The table below shows the top 10 holdings at the end of 2025. What I like about that list is that there’s a lot of exposure to chip (Nvidia, Broadcom, AMD, TSMC) and chip manufacturing equipment stocks (Lam Research, KLA).

I reckon these stocks will do well in the years ahead. They should benefit as companies like Amazon, Alphabet, and Meta spend heavily on AI infrastructure and the world becomes more digital.

Digging deeper into the holdings, there were some really interesting names in the portfolio at the end of October (the latest full portfolio holdings data available). Some examples here include taser maker Axon Enterprise, AI powerhouse Palantir, data centre cooling specialist Vertiv, and fast-growing investment platform Robinhood Markets.

Of course, there’s a chance that these names have been sold since the end of October. But it shows you the types of innovative companies in the portfolio.

One other thing to like about this trust is that it currently trades at a near-10% discount to its net asset value (NAV). In other words, anyone buying now is getting access to a basket of high-quality tech stocks at a significant discount.

Risks and fees

Of course, there are plenty of risks to consider with this product. One is the sector focus.

While the portfolio is well diversified at stock level, it’s not very diversified at sector level (although there are a few stocks in the portfolio that aren’t pure tech stocks). So, if the tech sector was to have a meltdown (or even just go nowhere), this trust would most likely underperform.

The significant exposure to chips is another risk to consider. This area of technology has historically been volatile.

In terms of fees, ongoing charges are 0.77%. That’s relatively high.

There are some other products in this space that have lower fees. An example here is the iShares S&P 500 Information Technology Sector UCITS ETF (its fees are just 0.15%).

Overall though, I see quite a bit of appeal in this product. I believe it’s worth considering for a diversified portfolio.

The post £1,000 buys 198 shares in this FTSE 100 investment trust that’s returned 25% a year for the last 10 years appeared first on The Twelfth Magpie.

FTSE 100-listed Vodafone (LSE:VOD) is one I’ve noted. And from the FTSE 250, Polar Capital Technology Trust (LSE:PCT) and QinetiQ (LSE:QQ.) are another two bargains that have caught my eye.

Can investors afford to pass them up? Here’s why I think they’re top value stocks to consider.

A cheap investment trust

Fears of a potential ‘AI bubble’ have driven shares in Polar Capital Technology Trust sharply lower of late. This isn’t much of a surprise given the investment trust’s large holdings in AI stocks like Nvidia, Meta Platforms, and Microsoft.

For investors who reject the bubble narrative, I think this could represent an attractive dip-buying opportunity. The trust currently trades at a 12% discount to net asset value (NAV) per share around 512p.

I like the broad range of tech shares that Polar Capital Technology contains (93 in total). This provides exposure to an array of white-hot growth segments, including AI, cybersecurity, robotics, biotechnology, and cloud and quantum computing.

Such diversification also helps protect investors against risk. Over five years, the trust’s enjoyed a total return north of 700%. I think it can keep delivering over the long term.

Defence bargain

QinetiQ’s plummeted in value during Q4, leaving it (in my opinion) one of the UK’s best-value defence shares.

Its forward price-to-earnings (P/E) ratio is a sector-leading 13.4 times. Meanwhile, its P/E-to-growth (PEG) sits at just 0.8. Any sub-1 reading indicates a share that’s trading below value.

QinetiQ’s slump is especially surprising to me given recent trading news. It remains firmly in recovery after fixes to its US business, and order intake more than doubled in the six months to September (£2.4bn).

A possible peace deal between Ukraine and Russia represents a natural threat. But in the broader geopolitical landscape, I’m expecting the company’s shares to rise strongly over time.

A FTSE value star

Vodafone’s not without its challenges. Its turnaround in Germany is likely to be a lumpy process given high competitive pressures. It also faces large ongoing capex charges that could dent earnings.

I believe these problems are more than reflected in Vodafone’s rock-bottom share price, though. Its price-to-book (P/B) ratio is 0.5 times, even after recent price gains.

Meanwhile, the company’s forward P/E ratio is 13.2 times. That’s far below the 10-year average of 17.7.

I think there’s good reason to expect Vodafone shares to continue their 2025 rebound. Progress in its core German market, allied with a tighter grip on costs show a company clearly moving in the right direction. Last month it raised profit guidance and tipped adjusted EBITDA at the upper end of a €11.3bn to €11.6bn range.

I think Vodafone can rise steadily as telecoms demand gradually rises, with particular strength expected in the cheap share’s African markets.

The post Can investors afford to miss these 3 dirt-cheap UK shares? appeared first on The Twelfth Magpie.

Still, being prepared can’t hurt. And in some cases, it can turn a potential catastrophe into an opportunity.

Will the market crash?

Last week, the FTSE 100 suffered one of its sharpest dips in months, falling 3% in less than 48 hours. That’s concerning, but understanding why markets crash can help alleviate the worry. 

Sometimes they’re the result of a natural disaster, like the pandemic, but more often they’re simply a healthy correction. And as history shows, they don’t last forever.

The recent rallies in the US and UK mimic similar ones that preceded corrections, so it wouldn’t be unusual for another to occur soon.

To prepare, I’ve been rebalancing into defensive shares as they tend to weather market downturns better. But I’ve also been doing something else.

Saving for a shopping spree

Are there any stocks you want to buy, but they’re just too expensive? Well, a stock market crash could be an early Christmas self-gifting opportunity.

The trick is having cash on hand to avoid selling other stocks at a loss to finance new investments. But it’s important not to dive in immediately — market dips can drag on longer than expected, and in a recession that cash may be a much-needed lifeline.

Once things have stabilised and a recovery’s in sight, then consider where opportunities lie. Not every stock will necessarily recover, so it’s still critical to carefully assess each option.

One stock I’ve got my eye on is Polar Capital Technology (LSE: PCT), a trust that invests in US tech stocks like Nvidia, Microsoft and Meta. With the US tech sector looking particularly wobbly, the trust could take quite a dip if things go south.

The £4.58 share price is by no means unaffordable, but currently looks heavily overvalued, with a price-to-earnings (P/E) ratio of 49.2. I think it has a lot of potential, but I don’t want to pay that premium — it could severely limit my future returns.

If a crash brought the P/E ratio below 20, the growth potential could be significant. However, its heavy concentration in US tech is also an ongoing risk, not to mention its reliance on the fund management team’s continued good judgment.

For now, I think they’re doing great, so I plan to buy the stock if the valuation drops.

The bottom line

In most cases, a stock market crash is nothing more than normal, cyclical behaviour. Seasoned investors not only expect them, they actually look forward to them as opportunities.

While nobody knows exactly when they will occur, it pays to keep an eye on valuation metrics. Higher-than-average P/E ratios across the board are a common precursor.

Rebalancing from high-growth stocks into defensive shares can soften volatility, while having cash on hand means you’re ready to take advantage of lower prices.

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