The stock market has been volatile over the past couple of weeks, mostly due to the uncertainty created by the US administration’s imposition of global tariffs. One of the most popular stocks for UK investors is Lloyds Banking Group (LSE:LLOY). So far, the Lloyds share price has jumped both higher and lower, but ultimately remaining virtually unchanged compared to a month ago. Here’s what I think will happen next.

Not too exposed

Let’s start with the most straightforward consideration: Lloyds is a UK-focused bank. Over 95% of its revenue comes from the UK, and it doesn’t have significant operations in the US. So, from that angle, the tariffs won’t impact the business directly.

The other point is that Lloyds predominantly serves corporate clients in the UK that also operate domestically. So again, the risk here of a sharp slowdown in activity is low. Of course, it does have clients that trade out of the UK with the US. But even in this case, the current tariff rate of 10% isn’t crazy, with the UK looking to pursue a trade deal. A trade war with the UK isn’t high on the list of priorities for the US.

From those angles, the Lloyds share price could be a winner when considering the broader FTSE 100. This is because other FTSE 100 peers are international companies, with operations in China and the rest of Asia, as well as the US. In this case, there’s a lot of risk due to the tensions between China and the US. Investors will have noticed this. If they have spare cash to deploy right now, I’d imagine stocks like Lloyds could be a lot more appealing than businesses that trade globally!

A barometer for the UK

Despite the potential for Lloyds stock to rally, there are more indirect concerns to flag. As it’s a domestic bank, the firm is seen as a bellwether for the broader UK economy. If higher tariffs hit the UK, it could dent UK export performance causing business confidence to weaken. This could hurt UK consumer sentiment too.

This matters to the bank because it could see transactional spending dry up and lower demand for loans and mortgages. The share price could fall as investors decide to move away from domestic UK companies and try to diversify with those less exposed to the UK.

Key results ahead

On balance, I think Lloyds could end up being a net winner from the market turmoil. When zooming out, the banking stock is up 31% in the past year. The following quarterly results are scheduled for the beginning of May, and I think this will provide some key commentary on how management see the tariffs impacting operations. Therefore, I’m going to wait until then before making a final decision on whether to buy or not.

It has been a tough couple of years for Aston Martin (LSE:AML), with the 24% fall in the past month indicating that there are still problems at the luxury car manufacturer. The FTSE stock hit all-time lows last week, with issues, meaning that a friend of mine asked if the company could actually be at risk of going bankrupt this year. Here are my current views.

Serious problems

The business has struggled financially for the past few years. For the 2024 financial year, it recorded a post-tax loss of £323.5m, an increase from the £226.8m in the previous year. Demand is lower, with total wholesale volumes dropping from 6,620 vehicles in 2023 to 6,030 vehicles last year.

If you’re selling fewer vehicles, revenue is going to fall. If the business can’t make a profit at the moment and has a bleak outlook, it’s going to be really tough to make a profit this year or next. Investors aren’t stupid; they can realise this. So the 61% fall in the last year (and even over a longer time period) reflects the view that Aston Martin as a company isn’t where it needs to be.

Another issue that has become evident since January is tariff risk from the US. The new US president is using tariffs as a trade tool, with Aston Martin getting caught in the crosshairs. The exact percentage tariff for exports to the US keeps changing, but I’d imagine it’ll settle around 10-25%. Given the company’s gross profit margin of 36.9%, this is clearly going to be a big hit! The business doesn’t have production in the US, so it can’t just flip manufacturing away from the UK easily.

Managing concerns

One reason why I don’t see a short-term risk of the company going bust is due to liquidity. As of the end of last year, it had cash of £360m and available credit facilities of £154m. At the end of March, chairman Lawrence Stroll announced he was investing another £52.5m. With other forms of debt already in place, the company has enough cash flow to prevent any sudden issues that could stop operations.

Another bright spark comes from the revamped vehicle line-up. The new Vanquish sports car has won various performance awards, which could help drive better sales this year. Given the continued price increases (the average selling price in 2024 was up 6% to £245k), this could aid cash flow.

Not for me

Even though I don’t believe the business will go bankrupt this year, I’m staying well away from investing. The problems it faces are substantial. It’s worth noting that it has filed for bankruptcy on several occasions, with the last being in 1987. I think an investor can find better value stock options to consider elsewhere.

The FTSE 100 is down almost 7% over the past month. Yet there are some early indications that the dust is starting to settle after a manic few weeks. The 90-day tariff pause and exemptions for certain products have provided some relief for investors around the world. Even though we might not be out of the woods yet, here are two growth shares that I think look attractive right now.

Primed for success

The first idea is Plus500 (LSE:PLUS). The FTSE stock has rallied by 51% over the past year. It has even managed to move higher over the past month despite the volatility. One key reason for this is that the whipsaw price action in different asset classes is good for business.

The trading and investing platform makes money in several ways. Yet the largest driver is making a small spread on each transaction placed by clients. So, the more trades that get placed, the more profitable Plus500 becomes. Typically, when there’s not much going on in the stock market, it’s bad for business as no one is really buying or selling. But last Wednesday (April 9), we saw approximately 30bn shares traded across US exchanges! This marks the highest single-day volume on record.

I believe the huge interest in markets right now will translate into strong company results. Even though the dust might settle in the short term and dent its business, we still have several years ahead of President Trump, providing ample time for volatility to spike again.

One risk is that the sector is becoming increasingly competitive. FTSE 250 peers like IG Group and CMC Markets do basically the same thing. They are all focused on gaining market share from the others.

Resetting expectations

A second growth stock to consider is Raspberry Pi (LSE:RPI). Although its share price has tumbled 28% in the past month, it hasn’t been publicly listed for a year, but it’s currently still trading comfortably above the IPO price of 280p.

One reason the stock has fallen is that 2024 results released at the start of April didn’t meet investor expectations. Revenue for the year fell by 2% compared to 2023, with operating profit down 4%. Even though this might not seem terrible, it’s meant to be a growth stock and a darling of the UK tech space. People were looking for year-on-year gains, which wasn’t the case.

Despite this disappointment, as people calm down I think the dip will get bought. A total of 22 product launches happened in the year, and “given the planned product release schedule and mix of sales, gross profit per unit is expected to increase year-on-year.” The company laid the foundation in 2024 and it should see the financial benefit in 2025.

The results also spoke of a “number of promising direct discussions with major prospective OEM customers”. If a few of these can progress, I’d expect the share price to spike when updates get shared with the public.

Of course, the high bar of expectations means that if results aren’t brilliant, the risk going forward is a further share price fall. Yet I think the recent move reflects a reset, with the valuation more attractive now for investors to consider.

The stock market has been incredibly volatile recently. Last week, America’s S&P 500 index registered its worst four-day streak since 2008.

Now, as someone who’s been investing since the early 2000s, I’ve seen this kind of market activity before. With that in mind, here are four tips to get through the current turbulence.

Stay calm and stick to your strategy

When markets are tanking and there’s fear in the air, it’s crucial to stay calm and stick to your investment strategy. If you panic, you could end up making an irrational move that you’ll come to regret down the line.

Remember that market volatility is a normal part of investing. While stocks tend to provide great returns in the long term, they never go up in a straight line.

Think ahead

Speaking of the long term, now’s a good time to focus on it. Instead of thinking about what’s going to happen over the next month, think about where stock markets could go over the next decade (they almost always go up over 10-year periods) and how you could potentially set yourself up financially by making the right moves today.

It’s worth pointing out here that if you have a long-term horizon, you’re much better off buying shares at lower prices instead of higher ones. And right now, share prices are much lower than they were a few months ago.

Focus on big themes

As well as taking a long-term view, it could be smart to take a thematic approach to investing. Think about the industries that are poised to get much bigger in the years ahead and consider allocating some capital to them now while prices are low.

One industry that I believe is set for massive growth in the years ahead is cybersecurity. With cyberthreats continually becoming more sophisticated, I reckon spending on this area of technology is going to boom over the next decade.

Now, there are many stocks in this industry that could be worth considering today including the likes of CrowdStrike, Palo Alto Networks, and Fortinet. If someone is looking for broad exposure to the industry however, they may want to consider the Legal & General Cyber Security UCITS ETF (LSE: ISPY).

This provides exposure to a range of leading businesses in the cybersecurity industry. Overall, there are around 35 stocks in the ETF (including the three I mentioned above).

This isn’t a product I’d put my life savings into. Cybersecurity is a dynamic industry (threats are always evolving) meaning companies’ growth can fluctuate. Meanwhile, a lot of companies in this industry have high valuations. So, their share prices can be more volatile than the broader market.

Taking a long-term view, however, I believe this ETF has a lot of potential.

Manage risk

Finally, my last tip is – think about risk and don’t try to be a hero.

Consider drip-feeding capital into the market bit by bit (buying mainly on days when the market is down). This will ensure that if stocks fall further, you can still capitalise.

Remain diversified. ETFs like the one above can be a good way to spread out your capital.

And focus on high-quality companies that are going to be around in the future. Now isn’t the time to put your life savings into a speculative penny stock that could go bankrupt if economic conditions deteriorate.

What a fortnight it’s been in the stock market. The S&P 500 had its worst day since 2020, then its best week since 2023. But investors should pay attention to Tesla (NASDAQ:TSLA) shares.

After all that volatility, a £10,000 investment in the stock two weeks ago is now worth… £9,733. It’s almost as though nothing happened – but it hasn’t felt that way. 

Share price movements

A £10,000 investment in Tesla from 31 March has taken quite the scenic route to go almost nowhere. To start with, ‘Liberation Day’ tariff announcements sent the stock down almost 22%. 

Shortly afterward, news of a 90-day window for trade negotiations saw the stock bounce back to above where it was two weeks ago. And since then, it’s settled just below that level.

The volatility has been extreme and very difficult to predict. But investors who were able to keep cool heads have found that things have turned out just fine. This is often the way with the stock market. Share prices move up and down, but if nothing major changes with the underlying business, things tend to work themselves out over time.

Businesses vs stocks

From an investment perspective, I don’t think anything much has changed with Tesla. As I see it, everything hinges on the company’s ability to launch and scale its robotaxi business. The biggest obstacle to this is regulation. But the company’s ability to overcome this doesn’t – in my view – have anything to do with the tariff news that has been moving the share price.

That’s not to say Tesla is entirely unaffected by higher import costs. If this leads to inflation, US consumer spending could come under pressure and this won’t be good for car sales. 

From an investment perspective though, I don’t think this is the most important thing. It’s very hard to see how car sales justify the current market-cap – it comes down to robotaxis.

An investing lesson

The last couple of weeks have presented an important lesson for investors. When the Tesla share price fell 22%, it must have been tempting to sell in case it went any lower. This however, would have been a mistake. Not just because the stock bounced back to recover its losses, but because not much had changed with the underlying business.

Tesla’s share price over the last fortnight is an unusually extreme example, but almost all stocks fall sharply at some point or other. The best ones however, recover. It’s a general feature of the stock market that the best days often follow hot on the heels of the worst ones. Investors need to try and make sure they’re in a position to benefit.

Stock market volatility

Staying the course isn’t always straightforward. For various reasons, both institutions and individuals can find themselves having to sell stocks when prices are low. Investors however, give themselves the best chance by being able to hold onto stocks for the long term. Over time, shares in quality companies tend to overcome sudden downturns.

Tesla’s share price is an extreme example. But it’s one that investors should pay attention to when thinking about how to do well by investing in the stock market.

The FTSE 250 offers a world of opportunity for investors seeking to diversify their portfolios. Building a well-balanced mix of shares, funds and investment trusts is critical at any stage of the economic cycle. But with trading conditions threatening to become much tougher for many companies, diversification is taking on greater importance as a risk-management tool.

Owning different categories of equities can also help generate a stable return over time. Growth and value stocks can provide significant long-term capital gains, while dividend shares can provide defensive protection during economic downturns.

With this in mind, here are three shares from each category I think would be worth considering as part of a balanced UK stocks portfolio.

Growth

Increasing digitalisation, accelerating online threats and growing regulation means cybersecurity companies like NCC Group (LSE:NCC) have significant room for long-term growth. According to Fortune Business Insights, the global market will grow at an annualised rate of 12.9% between now and 2032, at which point it will be valued at a stunning $562.7bn.

NCC offers a wide range of services in this field, including consulting, attack detection and assurance. This gives it multiple ways to capitalise on this booming market.

Be mindful however, that sales cycles have been lengthening in recent months, and this could continue if the global economy cools. At the moment City analysts are tipping earnings growth of 53% and 30% for the next two financial years (to May 2025 and 2026 respectively).

Dividends

Real estate investment trusts (REITs) such as Tritax Big Box (LSE:BBOX) are popular picks for investors seeking passive income. This is because they tend to have their tenants locked down on long-term contracts, the rental income from which can be doled straight out to shareholders.

As well, REITs must pay at least 90% of the profits they make from their rental operations out in dividends.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

Tritax is an exceptionally robust REIT, in my opinion. The weighted average unexpired lease term (WAULT) was 10.6 years at the end of 2024. It also has a wide array of blue-chip companies on its books like Amazon and Tesco.

The firm has a solid balance sheet too, with a loan-to-value (LTV) of 28.8% at the end of 2024. The trust’s forward dividend yield is a huge 6.2%.

I think it’s worth a close look, even though the potential for interest rate rises are a constant risk.

Value

FTSE 250 retailer B&M European Value Retail (LSE:BME) isn’t without its share of risks. Even sellers of cheaper goods like these aren’t immune to ongoing pressure on consumer spending, as recent disappointing trading updates here have shown. Group revenues rose just 2.8% between April and December.

While things could remain tough, I think B&M’s rock-bottom valuation more than reflects this possibility. The former FTSE 100 share now trades on a forward price-to-earnings (P/E) ratio of 8.3 times.

With a 7.2% forward dividend yield too, it offers solid all-round value, in my opinion. A robust longer-term outlook for value retail — combined with B&M’ ambitious store estate expansion plans — makes this fallen angel worth a close look, in my opinion.

BP’s (LSE: BP.) share price has taken a major hit recently. Year to date it’s down around 16% while over one year it’s down about 38%. Is there value on offer after this double-digit percentage pullback? Let’s discuss.

A value stock?

At first glance, shares in the oil giant do look quite cheap right now. Currently, City analysts expect BP to generate earnings per share (EPS) of 54 cents in 2025. That forecast places the stock on a forward-looking price-to-earnings (P/E) ratio of just eight. That’s well below the UK market average and miles below the P/E ratios on US-listed energy giants Chevron (13) and Exxon (14).

A few other metrics are also worth highlighting here. One is the stock’s free cash flow yield. Last year, BP’s free cash flow was 71 cents per share. That puts the trailing free cash flow yield at about 16%, which is very high (a high ratio can signal that there’s value on offer).

Then there’s the dividend yield. It’s currently about 7.5%. That’s also high. Often, cheap stocks sport high yields.

Cheap for a reason?

However, before we rush out and buy the oil stock because it looks cheap, there are a few issues to consider. Often, cheap stocks are cheap for a reason.

One major issue to be aware of is that US President Donald Trump wants to bring oil prices down (oil is already down about 7% over the last month). His goal is to boost US production (his mantra is ‘drill, baby, drill’) and he hopes this will lead to lower prices.

Now, lower oil prices would have a negative impact on BP. They would most likely lower revenues, cash flows, and earnings (pushing the P/E ratio up and making the shares look less cheap).

Another major issue is the possibility of a global recession in the near future (which is looking increasingly likely given the uncertainty surrounding tariffs). This would most likely reduce demand for oil, which wouldn’t be good for BP.

A third factor to be aware of is investor sentiment, which is weak right now and could remain depressed for a while. The issue here is that a lot of major investors aren’t happy with BP’s shift away from renewable energy.

One such investor is Legal and General, which is currently BP’s seventh-biggest shareholder. Recently, it said that it was “deeply concerned” by the company’s decision in February to reduce its focus on clean energy in favour of oil and gas.

This kind of negative sentiment could keep the stock depressed. Because large investors can be influential when it comes to share prices.

What now?

So, where does this leave us?

Well, there’s certainly a chance that BP shares could deliver solid returns from here (especially considering the high dividend yield). So, they could be worth considering.

However, my personal view is that there are better shares to consider buying. I’d rather put my money into a company that has more attractive long-term prospects.

The UK is a great place to find dividend shares, in my opinion. History shows that London Stock Exchange companies — and particularly those on the FTSE 100 — have a far stronger culture of paying large and growing dividends to their shareholders than overseas shares.

Encouragingly, the experts at AJ Bell believe that 2025 will be another bumper year for holders of UK blue-chip shares. They think annual dividend growth across the index will accelerate to 5% from 1% last year.

As a consequence, Footsie companies are tipped to pay £83bn worth of dividends in 2025. That equates to around 5% of the index’s total market capitalisation of £2.2trn.

A FTSE dividend rock

The trouble is that AJ Bell made these predictions before President Trump announced his thumping trade tariffs for foreign goods (April 2). Suddenly the dividend picture for many FTSE 100 shares looks less assured as the spectre of a global trade war, subsequent recession, and reduced corporate earnings loom large.

So I’m searching for dividend shares to consider that could deliver a healthy passive income in 2025 even if the global economy implodes. Legal & General (LSE:LGEN) is one such stock whose balance sheet provides dividend forecasts with plenty of steel.

The financial services company throws off tons of extra cash, giving it strength to regularly raise annual dividends and make substantial share repurchases. It made buybacks of £200m in 2024, and expects to ramp this to £500m this year.

With a Solvency II ratio of 232% as of December — up eight percentage points year on year — Legal & General looks in good shape to keep raising dividends even if tough conditions impact earnings. Its ability to raise annual payouts in 12 of the last 13 years underlines its resilience.

For 2025, the dividend yield on Legal & General shares is a colossal 9.5%. Be mindful however, that signs of earnings disappointing could have significant negative implications for the company’s share price.

One more income star

Defence giant BAE Systems (LSE:BA.) doesn’t carry the mighty dividend yields of Legal & General shares. For this year it sits back at 2.1%. But I think its quality as a generous and reliable dividend grower still makes it worth serious consideration. Annual dividends here have risen each year since 2012, including a 10% hike last year.

Incidentally, City brokers expect a meaty 8% rise in shareholder payouts in 2025.

BAE Systems has several tools in its arsenal (so to speak) that underpin current forecasts. It has a robust balance sheet, and in 2024 free cash flow topped forecasts at an impressive £2.5bn. Predicted dividends are also covered 2.1 times by earnings, providing a wide margin of error.

Not that I’m expecting profits to get blown off course however. Supply chain issues that impact project delivery are a risk, which in turn could impact revenues. But things are looking pretty rosy on balance as NATO countries (excluding the US) embark on rapid rearmament programmes.

I first took notice of FTSE 100 insurance and investment giant Phoenix Group Holdings (LSE: PHNX) in March 2023.

My stock screener had flagged the stock because its yield had shot up to around 10%. By comparison, the average yield for the FTSE 100 was 3.7% at the time, and for the FTSE 250, it was 3.3%.

Its payout had hit this extraordinary level because its share price had dropped after the failure of Silicon Valley Bank. That ignited fears of a new financial crisis, pushing stock prices in the sector lower.

Given no change to a stock’s annual dividend, its yield moves in the opposite direction to its price.

Since then, the company’s consistently ultra-high yield has generated a lot of dividend income for me. It had also given me a significant share price gain before the US announced its swingeing tariffs on 2 April.

History has repeated itself, it seems to me. The resultant fall in Phoenix Group’s share price has pushed its yield up to a whopping 9.9%.

Does the business still look solid to me?

Ultimately, a firm’s earnings powers its share price and dividend higher.

I think a short-term risk to these for Phoenix Group could be a global recession that prompts customers to cancel policies.

However, consensus analysts’ estimates are that Phoenix Group’s earnings will grow by a stunning 91.6% a year to end-2027.

Such projections look well-supported to me by its 2024 results. These showed IFRS adjusted operating profit soaring 31% year on year to £825m. Operating cash generation leapt 22% to £1.403bn over the same period.

As a result, the firm increased its total cash generation target to £5.1bn from £4.4bn by end-2026. Its IFRS adjusted operating profit target was also upgraded to around £1.1bn from £900m by the same point.

How much passive income can be made?

Investors considering a holding of £11,000 – the average UK savings amount – in Phoenix Group would make £1,089 in first-year dividends. This would rise over 10 years on the same average yield to £10,890. And after 30 years on the same basis, the dividends would have increased to £32,670.

Crucially though, these returns could be far greater if the standard investment practice of ‘dividend compounding’ were used. This just involves reinvesting dividends paid by a stock straight back into it.

Using this technique the dividends would see the dividends rise to £18,484 after 10 years not £10,890. This is with the same average 9.9% yield being applied to the same £11,000 initial stake.

On the same basis, the dividends would increase to £200,815 rather than £32,670.

Adding in the £11,000 first investment and the Phoenix Group Holding would be worth £211,815.

So by that point, it would pay £20,970 a year in dividend income.

Should I buy more?

I believe the extremely strong forecast earnings growth will drive the dividend and share price much higher over time.

Indeed, a discounted cash flow analysis shows the fair value of the stock is  now £8.18. Market forces could push it lower or higher, of course.

And analysts forecast that its dividend will rise to 55.8p in 2025, 57.3p in 2026, and 58.8p in 2027.

These would give respective yields of 10.2%, 10.5%, and 10.7%.

Consequently, I will buy more of the stock as soon as possible.

Vodafone’s (LSE: VOD) share price tumbled in the global market rout following the US’s imposition of tariffs on much of the world.

As a former senior investment bank trader aged over 50 now, I have seen several market shocks. These frequently provided opportunities to make quick short-term profits.

But as a multi-decade private investor they also often enabled me to pick up good stocks at bargain prices for the long term.

At moments of widespread trading turbulence such as these, I focus on core share value, not on market noise.

How does the business look?

Before the present market tumult, Vodafone had looked on a promising path to me — and it still does.

Its Q3 results showed group service revenue jumping 5.2% year on year to €7.9bn (£6.78bn). This increase in service revenue occurred despite a 6.4% contraction in its German business. It followed last year’s change in its pay-TV laws that allowed residents to opt out of TV services provided by their landlords.

More positively though, Vodafone sold its Italian business to Swisscom for €8bn. The money will be used to reduce net debt and to execute a €2bn share buyback. These are supportive of share price gains.

Vodafone’s now-approved merger with Three in the UK also looks very promising to me. It should bring coverage and cost benefits to the new operation.

A risk for the firm is any mishandling of the merger that would negate these benefits.

Are the shares undervalued?

As it stands, analysts forecast that the firm’s earnings will rise by 2.2% a year to the end of 2027. It is growth here that powers a company’s share price and dividend over the long term.

Currently, Vodafone trades at a price-to-earnings ratio of just 8 — bottom of its competitor, which averages 15. These comprise Telenor at 10.3, Deutsche Telekom at 13.7, Orange at 16.1, and BT at 20.

So, it looks very undervalued on this basis.

It looks the same on its 0.3 price-to-book ratio too, with a peer average of 1.8. And the same applies to its price-to-sales ratio of 0.5 compared to the 1.3 average of its competitors.

A discounted cash flow analysis shows Vodafone is 52% undervalued at its current 66p price.

Therefore, its fair value is £1.38, although stock prices can go down as well as up.

Will I buy the stock?

The younger the investor, the longer they can wait for a stock or market to recover from any shock. This means they can take more risk in the short term.

However, I am over 50 now, which puts me in the later stage of my investment cycle. Consequently, I have less time to wait for a recovery from any such shock and therefore should take less risk.

If I were younger, I would buy Vodafone shares on the basis that its core business looks strong to me. This should power its share price and dividend higher over the long term.

For me though, there is a significant additional risk associated with its sub-£1 share price. It means that every penny in price equates to 1.5% of the stock’s value.

I am not willing to take that price volatility risk at my age, so will not buy the stock.