While the UK stock market has delivered improved performance in 2019 thus far, the Bitcoin price continues to be significantly down on its all-time high. In fact, it’s around 80% lower than the level at which it traded in the final weeks of 2017, which suggests investors are retaining a cautious stance on its future prospects.
With ISA season in full swing, now could be a good time to buy a variety of stocks through a Stocks and Shares ISA. While they may lack the excitement of Bitcoin in some cases, they could offer high growth at low prices over the long run.
Growth opportunities
Although investing in shares through an ISA may seem to lack the appeal of Bitcoin in terms of growth potential, some stocks could generate significant returns over the long run. As ever, the world is becoming increasing digitalised, and this could mean there are growth opportunities across the technology sector. For example, artificial intelligence is due to become an increasingly important part of people’s everyday lives, and companies operating in this space could become increasingly profitable over time.
Even in more established sectors such as healthcare and consumer goods, there could be growth opportunities. An ageing and growing world population may mean that a variety of FTSE 100 pharmaceutical stocks generate high returns in the coming years. In the meantime, they may also offer high income returns. Emerging markets could provide continued growth as a result of rising wages and wealth levels. As such, a variety of consumer goods companies that operate in those regions could be worthy of investment.
Valuations
Although growth industries may have bright long-term futures, in many cases they appear to offer excellent value for money. Short-term risks to the world economy, such as a rising US interest rate and a potential full-scale trade war involving China and the US, could keep investor sentiment pegged back to some degree. This, therefore, could be an opportune moment to invest, with margins of safety apparently wider than they otherwise would be.
In contrast, investing in Bitcoin could prove to be a sub-optimal decision. Its value remains impossible to determine, since it lacks real-world usage potential. It’s therefore dependent upon demand and supply, which can change rapidly as the last 15 months have shown. And, while virtual currencies may represent the future for the financial system, the lack of infrastructure and the limited size of Bitcoin may ultimately hold back its prospects.
Therefore, while shares are often viewed as being somewhat less appealing than Bitcoin by some investors, this doesn’t appear to be the case. With valuations being low and there being a number of exciting growth areas on offer across various parts of the world, now could be the right time to buy a variety of shares within a Stocks and Shares ISA.