My Stocks and Shares ISA suffered a hammering when the Covid-19 pandemic took hold and sent UK share prices plummeting.
And just as restrictions were ending and we were looking forward to a new beginning, look what happened. Russia launched a war on Ukraine. Oil prices soared. Inflation spiralled. Interest rates rose. Oh, and my Stocks and Shares ISA slumped again.
Perhaps it’s my own fault for investing a fair portion of it in the financial sector, which always seems to suffer when anything bad happens. Still, many folk are looking at their ISAs and feeling glum. But not me — I couldn’t be happier.
I don’t want to cash in my ISA and start spending the cash yet. No, I hope to keep investing in it for at least another decade before I’ll need the money.
Still buying beef
In his 1997 letter to Berkshire Hathaway shareholders, Warren Buffett famously asked: “If you plan to eat hamburgers throughout your life and are not a cattle producer, should you wish for higher or lower prices for beef?”
He continued: “If you expect to be a net saver during the next five years, should you hope for a higher or lower stock market during that period? Many investors get this one wrong. Even though they are going to be net buyers of stocks for many years to come, they are elated when stock prices rise and depressed when they fall.”
So what have I been doing about the burgers, I mean stocks, in my ISA?
Cheap top-ups
I’ve held shares in online fashion retailer boohoo for a while. And then they crashed to around a third of what I paid. So did I pull my hair out? Nope, I invested the same amount of money again, and this time I got three times as many shares.
And my most recent purchase only came about because share prices have been plunging. There are lots of high-tech US companies that I think have great futures. But their sky-high stock valuations have always looked overblown to me.
But after the NASDAQ crash, I’ve just bought some Scottish Mortgage Investment Trust shares. That trust invests in all these tech shares that had collapsed, so I was able to buy in at a price that I thought was a great bargain.
What will I do next? I also hold some Lloyds Banking Group shares that have tanked. And that gives me an opportunity to buy some more at what I see as oversold prices.
All tomorrow’s buys
I just don’t have the cash saved for my next Stocks and Shares ISA investment yet. I haven’t decided whether it will go into more Lloyds shares. But I’d like the price to stay low and maintain that attractive option.
And I’d like share prices to remain low for my next investment after that. And for all of next year’s share purchases too, and so on.
All these stocks I’ve mentioned do have their own risks. And I think there’s a fair chance they could fall even lower as the economic crisis unfolds. But then I could buy more of them even cheaper.