Day: February 1, 2023

2 globetrotting ASX ETFs for investors to buy in February

A cute young girl wears a straw hat and has a backpack strapped on her back as she holds a globe in her hand with a cheeky smile on her face.

A cute young girl wears a straw hat and has a backpack strapped on her back as she holds a globe in her hand with a cheeky smile on her face.

If you’re wanting to add some exposure to global markets to your portfolio, then an easy way to do it would be through exchange traded funds (ETFs).

Rather than having to open up an international brokerage account, ETFs can be bought in the same way that you would buy shares in ASX listed companies.

With that in mind, listed below are two top ETFs that allow investors to buy a large collection of international shares in one fell swoop.

Here’s what you need to know about them:

Vanguard MSCI Index International Shares ETF (ASX: VGS)

The first ETF for investing globally is the Vanguard MSCI Index International Shares ETF.

This popular ETF gives investors access to almost 1,500 of the world’s largest listed companies from 23 major developed countries including the U.S, Japan, U.K, Canada, France, and Switzerland.

The fund manager notes that the ETF offers greater access to sectors such as technology and health care that aren’t as well represented in the Australian share market.

Among the global giants you’ll be buying with this fund are Apple, HSBC, LVMH Moet Hennessy Louis Vuitton, Nestle, Procter & Gamble, Roche, Royal Bank of Canada, Shell, and Visa.

Vanguard U.S. Total Market Shares Index ETF (ASX: VTS)

Another ETF for investors to look at for international exposure is the Vanguard Australian US Total Market Shares Index ETF.

As you might have guessed from its name, this low-cost ETF provides investors with access to some of the largest companies listed in the United States.

Vanguard believes it could be a top option for buy and hold investors. Particularly those that are seeking long-term capital growth, some income, and international diversification.

Among the companies included in the ETF are household names such as Amazon, Boeing, JP Morgan, Starbucks, and Walmart.

The post 2 globetrotting ASX ETFs for investors to buy in February appeared first on The Motley Fool Australia.

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*Returns as of February 1 2023

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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. has positions in and has recommended Vanguard Msci Index International Shares ETF. The Motley Fool Australia has recommended Vanguard Msci Index International Shares ETF. 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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Experts say these ASX dividend shares are top buys right now

Man looking amazed holding $50 Australian notes, representing ASX dividends.

Man looking amazed holding $50 Australian notes, representing ASX dividends.

If you’re looking for dividend shares to buy, then the two listed below could be worth a look.

Both have been named as buys by experts recently. Here’s why they are bullish on them:

Macquarie Group Ltd (ASX: MQG)

The first ASX dividend share that could be in the buy zone is this investment bank.

The team at Morgans is positive on Macquarie due to its exposure to long term structural tailwinds. It explained:

We continue to like MQG’s exposure to long-term structural growth areas such as infrastructure and renewables. The company also stands to benefit from recent market volatility through its trading businesses, while it continues to gain market share in Australian mortgages.

Morgans has an add rating and $214.33 price target on the company’s shares.

In respect to dividends, the broker is expecting partially franked dividends of $7.05 per share in FY 2023 and $7.36 per share in FY 2024. Based on the current Macquarie share price of $187.00, this will mean yields of 3.8% and 3.9%, respectively.

Universal Store Holdings Ltd (ASX: UNI)

Another ASX dividend share to consider is this youth fashion retailer.

Goldman Sachs is a fan of Universal Store and has just named it as a key pick. The broker is positive due to the company’s exposure to younger consumers, which it expects to continue spending in 2023.

It also believes that a recent update from an industry peer is supportive of its bullish view on Universal Store. It commented:

UNI a key pick into 1H23 results: the positive demand backdrop reported by AX1 gives us incremental confidence in the youth consumer discretionary category during the key holiday promotional period. Our monitoring of promotions and web traffic suggests UNI is performing in-line with our expectations and showing discipline with discounting.

Goldman Sachs has a buy rating and $7.55 price target on its shares.

As for dividends, the broker is expecting fully franked dividends of 26.1 cents in FY 2023 and 29.9 cents in FY 2024. Based on the latest Universal Store share price of $5.71, this equates to yields of 4.6% and 5.2%, respectively.

The post Experts say these ASX dividend shares are top buys right now appeared first on The Motley Fool Australia.

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*Returns as of February 1 2023

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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. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Macquarie Group. 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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Why did the Lynas share price rocket 20% in January?

Man pointing at a blue rising share price graph.

Man pointing at a blue rising share price graph.

The Lynas Rare Earths Ltd (ASX: LYC) share price went on a very strong run in January, rising by around 20%. The S&P/ASX 200 Index (ASX: XJO) climbed by 6%.

Lynas released its quarterly update on 30 January 2022, which included a number of interesting updates.

So, while investors may have liked that update for the three months to 31 December 2022, it may not have provided the fuel for a lot of recovery in the future.

We’ll have a look at the update in a moment, but let’s consider what happened in the wider market which could have impacted the Lynas share price last month.

Growth gets a boost

A number of ASX growth shares saw a pleasing rise over January as they recovered some of the lost ground from 2022.

For example, the Xero Limited (ASX: XRO) share price went up 9%, the Block Inc (ASX: SQ2) share price rose over 20%, and the Lovisa Holdings Ltd (ASX: LOV) share price climbed 13%.

It was also a good month for ASX mining shares, for example, the BHP Group Ltd (ASX: BHP) share price climbed by 8% and the South32 Ltd (ASX: S32) share price rose by 13.5%.

January saw a strong start to the year for commodity businesses as well. So, Lynas seems to have benefited from the recovery in investor sentiment for both growth shares and mining shares.

Lynas quarterly update

The business reported quarterly sales revenue of $232.7 million in the three months to December 2022, compared to $163.8 million in the first quarter of FY23 and $202.7 million in the second quarter of FY22. This is helpful for the Lynas share price.

Total rare earth production was up 6% year over year, and up 27% quarter over quarter.

Lynas explained that these numbers were up after water supply disruptions in the prior quarter.

It also said that “market prices started to increase again from December in anticipation of the late January Lunar New Year holidays and an expected rebound of the consumption in China”, though future pricing trends “will depend on China’s economic recovery”.

Lynas also revealed that progress on major construction activities accelerated at the Kalgoorlie rare earths processing facility in the quarter, while the Mt Weld expansion project is “progressing as planned”.

It continues to “progress its deliverables” for the development of a US rare earths separation facility.

Foolish takeaway

After the rare earth miner’s rise, analysts are now mixed on the Lynas share price. Of the analyst opinions that Commsec collects, there are four buy ratings, three hold ratings, and three sell ratings.

The post Why did the Lynas share price rocket 20% in January? appeared first on The Motley Fool Australia.

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*Returns as of February 1 2023

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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 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 Scott Phillips.

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Bears beware! ASX 200 recoups all of 2022’s losses plus more in January

A man in a brown bear costume holds the head of it in one hand while raising his other arm in excited victory-style pose.

A man in a brown bear costume holds the head of it in one hand while raising his other arm in excited victory-style pose.

Well, it has been a stunning start to the year for ASX shares, no way around it. Since the beginning of January, the S&P/ASX 200 Index (ASX: XJO) has gone from 7,038.7 points to the 7,476.7 points it ended the month at.

For what it’s worth, the ASX 200 has climbed even higher on this first day of February, hitting 7,537.7 points during the course of the trading day today.

Going from 7,038.7 points to 7,476.7 points represents a gain of 6.2% for the ASX 200. For some context, the average annual return (not monthly return) of an ASX 200 index fund like the SPDR S&P/ASX 200 Fund (ASX: STW) over the past 20 years or so is 7.74%.

So this is truly a stellar start to the year for ASX shares. Hopefully, you have seen some of these gains in your own portfolio.

ASX 200 returns in 2023 defy the odds

Backtrack just a month or two, and this would have been hard to foresee. At the end of 2022, all we seemed to hear was that 2023 would inevitably bring a recession.

Central banks around the world were continuing to lift interest rates amid high inflation, and the phrase ‘hard landing’ (referring to rising rates crashing the economy) was everywhere you looked.

It just goes to show that investing bears are more often wrong than they are right.

If an investor had listened to the market commentators warning of a rough 2023 and sold out of their shares ‘before the crash’, they would probably be feeling a little silly right now.

Now, we are only one month into the year. There are still 11 to go, and we might indeed see a recession or a bear market in 2023. Today could be the peak of 2023’s ASX 200 heights for all I or anyone else knows.

Our chief investment officer Scott Phillips shared a similar sentiment last month. Here’s some of what Scott said:

Can you imagine being the poor bastards who sold out at the end of last year because 2023 was going to be terrible? How do you reckon they feel now?

Again, they might still be right in 50 weeks’ time. But remember, the long term trajectory of the market is ‘up and to the right’, even if that journey is a bumpy one.

Stop trying to time the market. And stop listening to predictions. Please.

How to invest in 2023

But here’s what we do know. ASX shares go up far more than they go down. And if an investor sticks it out, through thick and thin, they are more likely to see the positive results that investing in shares brings.

Every year, ETF provider Vanguard releases an index chart. The latest version came out in August last year.

This chart tracks the returns of ASX shares, international shares and other assets over a 30-year timeframe. What it consistently shows is that shares, while perenially volatile, never fail to exceed previous all-time highs.

That’s despite wars, recessions, rising interest rates, falling interest rates, global geopolitical struggles and whatever other maladies you can think of. It also shows that shares, both ASX and US, consistently deliver better returns over long periods of time than all other assets.

Indeed, the chart shows that $10,000 invested in ASX shares in 1992 would have grown to $131,000 by 2022.

Like a broken clock, bears are occasionally right in their doom and gloom predictions. But that’s 131,000 reasons to just ignore the naysayers and keep on investing.

The post Bears beware! ASX 200 recoups all of 2022’s losses plus more in January appeared first on The Motley Fool Australia.

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*Returns as of February 1 2023

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Motley Fool contributor Sebastian Bowen 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 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 Scott Phillips.

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