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The markets have been behaving in some pretty erratic methods this yr, for my part. For instance, the FTSE 100 index of main British shares has hit new all-time highs despite the fact that the UK financial system has been wanting moderately sluggish.
That has acquired me fascinated about the potential of a inventory market crash. October has seen a few of historical past’s largest crashes. May the identical be true this yr?
Market timing’s not possible
The reply is, no one is aware of. It isn’t attainable to time the market with absolute confidence. As a substitute, what buyers need to do is make their very own guesses about what’s going to occur.
These will be very educated guesses – however in the end they’re nonetheless simply guesses.
I do see a number of warning alerts flashing within the inventory market proper now that would counsel it’s overvalued or maybe is on its method to a crash. The heavy concentrate on only a small variety of US tech shares is one, whereas the dizzying valuation of a few of these shares is one other.
However markets can seemingly defy financial gravity for lengthy intervals. So though I see some potential indicators of a looming inventory market crash, that doesn’t essentially imply there will probably be one subsequent month – and even within the subsequent decade.
Right here’s why I’m taking motion now!
So am I sitting on my palms simply ready to see whether or not there may be certainly a crash (or a inventory market correction) any time quickly? No.
I’ve been doing a few issues that I see pretty much as good apply for me as an investor, no matter what really finally ends up taking place within the inventory market.
A type of is to assessment my portfolio and see whether or not there are any shares I believe it is sensible to promote at their present valuation so I can take earnings off the desk. In actuality, I’ve not been doing a lot of that over the previous few months – however I’ve made some gross sales.
Looking for attainable bargains
The higher a part of my preparation for a possible inventory market crash (every time it might come) has been trying to find shares that I might be completely happy to personal, if solely I might purchase them at what I see as a gorgeous value.
By sustaining a listing of such shares, hopefully I will probably be able to act instantly within the occasion {that a} inventory market crash does ship costs sharply downwards.
Such home windows of alternative will be short-lived, so preparation upfront is essential in an effort to seize them.
One share I’m eyeing
For example, one of many names on my checklist of shares to purchase if the worth strikes down far sufficient is engineering firm Spirax Group (LSE: SPX).
The Spirax share value is decrease than it was at the beginning of 2025 – however solely by 2%! Which means it nonetheless trades for 31 occasions earnings. That’s greater than I want to pay.
Spirax’s concentrate on business purchasers means it isn’t a family title. However due to deep consumer relationships, bespoke engineering merchandise and presence in lots of mission-critical areas, its enterprise mannequin is worthwhile.
Weak demand within the firm’s thermal options division stays an ongoing threat to revenues. However I’ll fortunately purchase the share – on the proper value.
