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He FTSE 100 it is one step away from reaching its all-time high, and might even have reached it by the time you read this.
London’s first-class index currently stands at 7,845.91, less than 60 points below the record of 7,903.50 it hit four years ago in May 2018. It seems a lot more than that, of course, as we’ve seen the start of the Covid pandemic, war in Ukraine and cost of living crisis ever since.
Would buy the record FTSE 100
A run and a push and the FTSE 100 record is there for the taking. Hopefully it will go above 8,000 meters for the first time and then continue to climb. It sounds like a once-in-a-lifetime chance to get rich, but it’s not. The people who make money today are those who invested a long, long time ago, when the FTSE 100 was much lower.
I don’t get too hung up on the FTSE 100 headline rate. It seems important as it is updated every day in the news and is treated as a barometer of UK economic sentiment. And of course it’s great when the FTSE 100 rises as our online portfolios are bathed in blue and the totals on our Stocks and Shares ISA platforms are higher.
Unless someone is cashing in your wallet that day, it makes little practical difference. This is important to remember if the FTSE 100 suddenly hits a slump, as it surely will at some point. That doesn’t matter either, except for those who need to sell that day.
I will not change my behavior if the all-time record is broken and the FTSE 100 roars to 8,000, 9,000, 10,000 or higher. I also won’t change strategy if it falls below 7000 or worse.
I have been buying FTSE shares for 20 years and hope to for another 20 years or more (if I live that long). Whether the index goes up or down, I buy them.
I’ll buy when the stocks go down too
In fact, I prefer to buy stocks when the index is low, since that way I get more shares for the same amount of money. Also, my reinvested dividends buy more shares, which will be worth more when the index recovers. Also, I enjoy buying when the stock is down 10-20%. Who doesn’t like a bargain?
There are still plenty of bargain-priced companies trading on the FTSE 100, despite its current high. Obviously, not all stocks rise or fall at the same rate as the index as a whole. So it’s rare to find anything worthwhile.
I am happy the FTSE 100 is at an all time high as it has underperformed global stock markets for years. However, my personal portfolio has been doing very well despite everything, because I buy individual stocks instead of the entire index.
The FTSE 100 does not offer a one-time chance to get rich. Instead, it offers a lifetime opportunity to get rich, and I’m not going to waste it.
