Day: December 11, 2021

2 highly rated international ETFs for ASX investors

businessman holding world globe in one hand, representing asx etfs

Exchange traded funds (ETFs) continue to grow in popularity with investors and it isn’t hard to see why. Never has it been so easy for investors to gain access to groups of shares from all corners of the world.

But given how many ETFs there are to choose from, it can be hard to decide which ones to add to a portfolio.

To narrow things down, I have picked out two highly rated and popular ETFs to get better acquainted with in December. They are as follows:

iShares S&P 500 ETF (ASX: IVV)

The first ETF for investors to look at this month is the iShares S&P 500 ETF. It aims to provide investors with the performance of the famous S&P 500 Index, before fees and expenses.

The operator of the fund, BlackRock, highlights that the ETF gives investors exposure to the top 500 U.S. stocks through a single investment. It notes that Australian investors can use this to diversify internationally and seek long-term growth opportunities for a portfolio.

Among its largest holdings are Amazon, Apple, Facebook/Meta, JP Morgan, Johnson & Johnson, Microsoft, Nvidia, and Tesla.

The iShares S&P 500 ETF has provided in investors with a return of 18.5% per annum since 2016. This means a $10,000 investment five years ago would now be worth almost $23,500.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

Another ETF to look at is the Vanguard MSCI Index International Shares ETF. This ETF provides investors with exposure to over 1,500 of the world’s largest listed companies from major developed countries.

The manager of the fund, Vanguard, notes that the ETF offers low-cost access to a broadly diversified range of securities that allow investors to benefit from the long-term growth potential of the global economy. Vanguard appears to believe this makes it suitable for buy and hold investors seeking long-term capital growth, some income, and international diversification.

Among the companies included in the fund are giant such as Apple, Johnson & Johnson, JP Morgan, Nestle, Procter & Gamble, and Visa.

The Vanguard MSCI Index International Shares ETF has generated a total return of almost 15.8% per annum over the last five years. This would have turned a $10,000 investment into almost $21,000.

The post 2 highly rated international ETFs for ASX investors appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of August 16th 2021

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Vanguard MSCI Index International Shares ETF. The Motley Fool Australia has recommended Vanguard MSCI Index International Shares ETF and iShares Trust – iShares Core S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Is the Telstra (ASX:TLS) share price a buy for dividends right now?

A smiling woman with a handful of $100 notes, indicating strong dividend payment by Thorn Group

The Telstra Corporation Ltd (ASX: TLS) share price could be an option for income for investors to consider.

Telstra has been one of the biggest payer of dividends over the last decade with its generous dividend policy for shareholders.

The telco recently updated its dividend policy for investors, which indicated the board’s thoughts and intentions about its payouts.

Telstra’s latest dividend policy

Under Telstra’s new T25 strategy, it came out with an updated capital management framework. It included principles to maximise fully franked dividends and seek to grow them over time, to invest for growth and to return excess cash to shareholders.

Whilst delivering on its T25 goals, Telstra also said that it was confident in maintaining a minimum payment of a $0.16 fully franked dividend per share, as long as there are no unexpected material events and subject to the requirements of its capital management framework.

Telstra said that this principle of maximising dividends for shareholders recognised continued feedback from shareholders of the importance of fully franked dividends. It also reflects the company’s intention to return as much cashflow as can be supported by earnings, whilst balancing the objectives and principles of its capital management.

At the current Telstra share price, the $0.16 per share annual dividend translates to a grossed-up dividend yield of 5.6%.

This policy replaced the previous one of paying fully franked dividends of 70% to 90% of underlying earnings. That’s because the company is expecting cashflow to remain ahead of accounting earnings and it’s focused on growing.

What are the T25 goals?

T22 has been the focus for the last few years, which included cost cutting, restructuring and asset sales.

T25 involves extending 5G network coverage to 95% of the population, expanding regional coverage with both 4G and 5%, growing Telstra Plus members to 6 million by FY25, finding $500 million of further net fixed costs by FY25, profit growth and achieving more access to towers.

The profit growth target to FY25 is compound annual growth of mid-single digit underlying earnings before interest, tax, depreciation and amortisation (EBITDA) and high-teens compound annual growth of underlying earnings per share (EPS).

Is the Telstra share price good value?

Credit Suisse thinks so, with a price target of $4.40 on the business with reference to how Telstra wants to keep its mobile competitive advantage in Australia.

However, UBS is just ‘neutral’ on the business with a price target of $4, though the broker does think the telco is turning things around.

The post Is the Telstra (ASX:TLS) share price a buy for dividends right now? appeared first on The Motley Fool Australia.

Should you invest $1,000 in Telstra right now?

Before you consider Telstra, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Telstra wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Morgans names 2 ASX 200 shares to buy

a woman whispering a secret to a man who looks surprised

If you’re looking for some new options for your portfolio, then you may want to look at the shares listed below which Morgans rates highly.

Here’s why it has the equivalent of buy ratings on these ASX 200 shares:

Treasury Wine Estates Ltd (ASX: TWE)

The last two years have been difficult for this wine giant due to COVID-19 and China shutting out its premium Australian wines. The good news is that Morgans believes that the company’s outlook is improving greatly and its shares are trading at an attractive level.

Morgans commented: “TWE has the China reallocation risk and it will take 2-3 years to recover these earnings in new markets. However once it comps China earnings, we expect TWE to deliver strong earnings growth from the 2H22 onwards. Organic growth will be supplemented by M&A. On this front, we view TWE’s recent acquisition of Napa Valley luxury wine business, Frank Family Vineyards (FFV) as strategically important. This high margin business should see TWE achieve its US margin target two years earlier than planned. We see recent share price weakness as a great buying opportunity in this high quality company. The stock is currently trading at a material discount to its long term PE range.”

The broker currently has an add rating and $14.06 price target on the company’s shares. This compares to the latest Treasury Wine share price of $12.08.

Woodside Petroleum Limited (ASX: WPL)

If you’re interested in gaining exposure to the energy sector, then Morgans thinks Woodside could be a quality option. This is due largely to its transformative merger with the petroleum assets of BHP Group Ltd (ASX: BHP).

Morgans explained: “We believe WPL has benefited from being in the right place, at the right time. With: 1) BHP/WPL having an existing relationship, 2) BHP eager to boost its ESG profile, and 3) WPL being a quality operator (safe hands which is important for BHP). From an economic standpoint we think WPL is clearly getting the better of the deal, with synergies not baked into deal metrics and BHP willing to accept a discount. The deal is transformative, lifting WPL into being a top 10 global E&P with +2 billion barrels of 2P reserves, with EBITDA of US$4.7bnpa and growth options.”

The broker currently has an add rating and $29.95 price target on its shares. This compares to the current Woodside share price of $22.03.

The post Morgans names 2 ASX 200 shares to buy appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of August 16th 2021

More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Treasury Wine Estates Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Here’s what crypto investors need to know about the metaverse

A boy wearing a virtual reality headset opens his arms in wonder

Crypto investors have been on another wild ride this week.

After hitting all time highs in November, both Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH) have tumbled.

In the past 7 days, Bitcoin, the world’s biggest crypto by market cap, has lost 14% (as at Friday afternoon). Ether, the number 2 crypto, is down a less painful 8% over the full week.

There are numerous forces impacting the price of these leading tokens and other altcoins.

Longer-term, Josh Gilbert, analyst at multi-asset investment platform eToro told The Motley Fool, the metaverse will be a big one amongst those.

What is the metaverse and how does it impact crypto?

The metaverse, in a nutshell, refers to nascent online 3-D virtual environments.

“The noise around the metaverse was accelerated by Facebook changing its name to Meta, but this has since helped to grow the interest around the metaverse,” Gilbert said.

As for the metaverse’s impact on cryptos, and vice versa, Gilbert told us:

Cryptoassets are an integral part of how virtual reality and the metaverse will be constructed. Users will be able to buy, sell and trade virtual assets using cryptoassets through the metaverse. We are already seeing high profile sales of virtual assets through MANA, which is the cryptocurrency of Decentraland.

Which may have you asking, outside of spiritual energy, what exactly is mana?

Gilbert explains:

The MANA coin is used to purchase digital real estate within the Decentraland platform, known as LAND. LAND is essentially a non-fungible digital asset maintained in an Ethereum smart contract. MANA can also be traded with other users for goods and services hosted within the platform.

If you develop your land well enough, companies may even advertise on it. And if your land becomes popular with digital foot traffic, it can even become the ‘virtual version’ of a New York Times Square.

Who wouldn’t want to own land in Times Square? Even virtually.

But can’t the metaverse exist without crypto?

“There is, of course, the potential for a metaverse without crypto,” Gilbert said. “We already have virtual reality games without cryptoassets. But for the full experience, including buying and selling digital assets, then a digital asset such as crypto will be required.”

Why is blockchain a fundamental part of the metaverse?

“Everything on Decentraland is backed by the Ethereum blockchain,” Gilbert told us. “Without blockchain and, therefore crypto, the metaverse doesn’t exist how we imagine.”

Gilbert continued:

So far, blockchains such as Ethereum have proven to be unhackable. This is critical if users are expected to immerse themselves in a wholly digital world, and for the metaverse to reach mainstream adoption. On top of this, we will also need to see instant transactions with the ability to translate 24/7. This is something crypto and the blockchain can offer.

Decentraland itself is a virtual reality blockchain platform that aims to enable users to purchase, build and monetise virtual reality applications, to incentivise a global network of users to develop and operate a shared virtual world.

So, can investors in Bitcoin, MANA or any of the range of altcoins expect a big lift from the rise of the metaverse?

“We have already begun to adopt crypto payments globally, with names such as Visa and Mastercard allowing merchants to accept crypto payments,” Gilbert said.

He added:

Rather than the metaverse reflecting the future of crypto, the metaverse needs crypto to deliver on what we are being told the metaverse will be. So, it’s more the metaverse relying on crypto rather than the other way around. Crypto has a vital role to play in any metaverse.

I feel that this helps provide more use cases for crypto, as critics often argue about what is the ‘real world’ case for some cryptoassets. Here we see just how easily they can enter huge markets, like multi-billion-dollar industries such as music, sports and art, to name a few.

How has the MANA crypto been performing?

Many readers won’t be familiar with MANA. But crypto investors who bought the token a year ago are sitting on gains of some 3,000%.

“2022 will act as a sounding board for further growth with metaverse cryptoassets and of course, the metaverse,” Gilbert told us. “But it will likely be a few more years until we really see the full potential of the metaverse.”

The post Here’s what crypto investors need to know about the metaverse appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of August 16th 2021

More reading

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin and Ethereum. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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