Why I want share prices to be lower

The Australian share market is expected to fall heavily this morning, following on from a very negative day in the US.

The S&P 500 fell by just over 3%. That doesn’t sound like much compared to an individual share movement, but it’s a very negative day for a whole index to fall by 2%, let alone 3%.

But, you could also argue that iShares S&P 500 ETF (ASX: IVV) is now 3% better value. We’ve been waiting for shares to be better value. Now they are better value, people seem scared.

Most people reading and writing on are not yet retired – that means we are still buyers of shares. It’s a good thing for our future share purchasing if prices are lower. Granted, it’s not good for our current shares, but I have decades of share buying ahead.

Would I rather buy a quality growth share like Altium Limited (ASX: ALU) at a price 5% higher or lower than yesterday’s closing price? It’s pretty obvious what the answer is!

The only way to buy shares at good value is if they occasionally fall in price. Shares don’t just go up every month forever, particularly if interest rates are rising.

There’s a reason shares are seen as higher risk than most other asset classes. That view is actually slightly misplaced in my opinion, I believe shares give you the best chance of beating inflation by the biggest margin over the long-term. But, volatility is the price we pay to enter this great wealth-creating world. Volatility is not really the same thing as risk.

Foolish takeaway

This bull market has been one of the longest-running ones on record. We have gotten too used to steady asset value growth. Shares are meant to be volatile.

I’m really looking forward to using the volatility and lower prices as an opportunity to snap up quality businesses trading at bargain value like MNF Group Ltd (ASX: MNF), Citadel Group Ltd (ASX: CGL) and Bapcor Ltd (ASX: BAP).

Want some more ideas to consider investing in during this market fall? These ASX shares are all good contenders.

3 Top Blue Chips For The Market Crash

For many, blue chip stocks mean stability, profitability and regular dividends, often fully franked..

But knowing which blue chips to buy, and when, can be fraught with danger.

The Motley Fool’s in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool’s Top 3 Blue Chip Stocks for FY19."

Each one pays a fully franked dividend. Each one has not only grown its profits, but has also grown its dividend. One increased it by a whopping 33%, while another trades on a grossed up (fully franked) dividend yield of almost 7%.

The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand – and how quickly the share prices of these companies moves – we may be forced to remove this report.

Click here to claim your free report.

Motley Fool contributor Tristan Harrison owns shares of Altium and Bapcor. The Motley Fool Australia owns shares of and has recommended Bapcor and MNF Group Limited. The Motley Fool Australia owns shares of Altium and Citadel Group Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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