One doesn’t necessarily need to spend a fortune to try and get rich with the best UK shares. Past experience shows us that the average long-term stock investor makes an average annual return of around 8%. This gives an opportunity for regular savers like me to make tremendous profit on my hard-earned cash.
Based on that 8% figure, someone who invests £300 a month in stocks can realistically expect to have made a healthy £422,565 at the end of 30 years. This is the sort of capital pile one might need to have built to offset an increasingly mediocre State Pension. So it’s good to know that one doesn’t need to break the bank to build a big buffer for retirement.
I think now is a great time to go shopping for stocks for my portfolio as well. The September sell-off means that lots of top-quality British companies are trading at ultra-cheap prices. Here are two of the best UK shares I would buy with £300 in my pocket.
One of the best mining shares to buy
I think silver producer Hochschild Mining (LSE: HOC) is one of the best unloved UK shares to buy after falling heavily in September. Rising bond yields and a resurgent dollar have hit precious metals prices hard over the past few months.
It’s possible that these price drivers could remain and play and damage profits at mining companies like this, too. But I’m confident that silver and gold values could rebound strongly given the murky economic outlook. As analysts at TD Securities say, “fears of stagflation are growing ever stronger, which could once again spur interest in precious metals down the road”.
Inflation is soaring while economic growth is threatening to flatten. This is the perfect concoction for silver prices, and for Hochschild Mining’s share price, to rebound strongly. In addition, rising Covid-19 cases and fresh tension between economic superpowers China and the US could also supercharge demand for safe-haven assets like these. Hochschild’s low price-to-earnings ratio of 10 times certainly leaves plenty of scope for fresh share price gains.
Building big returns
I’d also happily stash £300 in landscaping products supplier Marshalls (LSE: MSLH) today. It wasn’t that long ago that the business was reporting better-than-expected trading after 2020’s washout smashed revenues. The recovery was broad-based, too, with sales booming across all of its domestic, public sector, commercial, and international markets.
Okay, Marshalls still trades on a high forward P/E ratio of 25 times even after September’s sell-off. This sort of high valuation could prompt further near-term share price weakness if trading begins to worsen. If supply chain issues weigh on revenues and push up costs, for example, that would cause problems for Marshalls.
However, I remain convinced Marshalls could be one of the best stocks to buy for my portfolio to ride the revival in the British construction industry. I reckon it’s a particularly great way to make money from the resurgent home improvement and house building sectors too. And I think it could make me a lot of money beyond the short to medium term as well.