Stock market slide: a golden opportunity to make money?

The past seven weeks have been a volatile time for UK stocks. After the FTSE 100 index peaked on February 16, stock market slide has caused panic. And when there was panic in the streets of London, I saw a golden opportunity to become rich long-term.

The market is down

In the first few weeks of 2023, the blue-chip index continued its rise that began when the US stock market reached its lowest point on October 12, 2022. From December 30, 2022 to February 16, 2023, the index rose 8% to a record. intra-day high of 8,047.06 points.

At this point, I warn you that Footsie may rise very, very quickly. After all, it’s up an impressive 17.9% since the October 12 close. With investor sentiment so high, I think there is a slide.

For the record, the FTSE 100 closed at 7,335.4 on Friday. This resulted in almost 712 points (-8.8%) in one month. What’s more, the index has now lost 1.6% of its value in 2023. For many investors, this decline is a surprise.

Do stocks like socks and hamburgers

My investment hero, mega-billionaire investor and philanthropist Warren Buffett, has said many times that falling stock prices can make for good deals.

For example, he once wisely said: “Whether we’re talking about socks or stocks, I like to buy quality merchandise when it’s marked down.” In 1997, he made a similar comment, arguing that hamburger buyers must want lower prices for beef.

So why do investors panic when the stock market slides? Surely we should accept lower prices to buy the same quality goods? From my perspective, I intend to buy and own more stocks for years to come, so buying bargains now should maximize future returns.

What shares would I buy now?

When the stock market took another dive on Wednesday, I asked my husband to find the money to buy more stocks. Unfortunately, he couldn’t oblige. Not because we are broke, but because they have invested close to 100% of our spare cash.

In short, I have been desperate to buy stocks this week. As an old-school value investor, I see the deep value hidden in the FTSE 100. For example, if someone gave me £25,000 today, I would immediately invest in, say, five quality stocks.

For me, one of the biggest deals in London right now is Blue Eagle bank Barclays (which I already have several shares). In the low, this undervalued stock reached 137.74p. At this price, this stock offers a tasty dividend yield of 5.2% per annum, with this cash yield covered four times by earnings.

However, these are historical figures, based on the bank’s trailing earnings. And as the UK economy weakens and consumer confidence declines, bank debt and loan losses should rise. Even so, with such a wide margin of safety, Barclays looks like a steal for passive income.

Furthermore, I see significant value lurking in various FTSE 100 sectors. These include asset management and insurance, banking, oil & gas, mining, and telecommunications. So if this stock market slide continues, I will be buying cheaper stocks in April when I have money to spare!