One positive outcome I have seen out of the market turmoil on the S&P/ASX 200 Index (ASX: XJO) in 2020 so far has been the renewed interest in the share market from some first-time investors keen to take the plunge.
Investing is a hard game to master, but one that is equally rewarding if you have the patience and develop the right temperament. Whilst you are sharpening your game, I always think it’s best to go for investments that aren’t just one single company at first.
So with that in mind, here are two ASX shares I think would make a great choice for a first-time investor.
iShares Global Consumer Staples ETF (ASX: IXI)
This exchange-traded fund (ETF) works by holding a basket of underlying shares within one investing vehicle. In this way, you can reduce your risk by spreading your capital across many different companies. IXI holds only companies that are in the ‘consumer staples’ space. Consumer staples are the goods and services defined as ‘needs’ rather than ‘wants’. Think food, drinks and household essentials.
As such, the companies that make them are usually regarded as ‘safe’ investments as demand for their products is unlikely to ever go away. IXI’s top holdings include names like Nestle, Coca-Cola, Clorox and Unilever. As you can see, these companies hail from all over the world and not just Australia. This makes this ETF a great stock to hold for diversification in my view, and I think it would form a great foundation for the starter portfolio of a first-time investor.
Magellan Global Trust (ASX: MGG)
Magellan Global Trust is a listed investment trust (LIT), which works in a similar fashion to an ETF in that it holds a basket of shares rather than just one company. However, the main difference is that Magellan Global Trust has an active management team which aims to select a group of diverse companies which it believes are the best in the world.
Currently, these include Starbucks, Tencent, Alphabet (Google), Mastercard, Pepsico and Microsoft.
Magellan Global has a strong history of using this philosophy to generate market-beating returns for its investors. Since 2017, it has managed 12% per annum on average, which isn’t bad considering the massive crash in global share markets we have seen in 2020.
Again, the calibre, as well as the diverse range and global reach of these companies, makes Magellan Global Trust a great first share to build up from, in my view.
For another top ASX share we Fools would recommend, check out the free report just below!
One “All In” ASX Buy Alert, that could be one of our greatest discoveries
Investing expert Scott Phillips has just named what he believes is the #1 Top “Buy Alert” after stumbling upon a little-owned opportunity he believes could be one of the greatest discoveries of his 25 years as a professional investor.
This under-the-radar ASX recommendation is virtually unknown among individual investors, and no wonder.
What it offers is an utterly unique strategy to position yourself to potentially profit alongside some of the world’s biggest and most powerful tech companies.
Potential returns of 1X, 2X and even 3X are all in play. Best of all, you could hold onto this little-known equity for DECADES to come
Simply click here to see how you can find out the name of this ‘all in’ buy alert… before the next stock market rally.
Returns as of 6/5/2020
More reading
- ASX 200 finishes up 1.4%, gold miner share prices surge
- The next ASX sector in a post COVID-19 earnings upgrade cycle
- These 4 ASX shares are at 52-week highs. Time to invest?
- Brokers name 3 ASX 200 shares to buy today
- Why the best performing ASX stock might have more room to run higher
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Sebastian Bowen owns shares of Alphabet (A shares), Starbucks, Coca-Cola, Mastercard, and PepsiCo. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares) and Mastercard. The Motley Fool Australia owns shares of iShares Global Consumer Staples ETF. The Motley Fool Australia has recommended Alphabet (A shares) and Mastercard. 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.
The post 2 ASX shares for a first-time investor appeared first on Motley Fool Australia.
from Motley Fool Australia https://ift.tt/2WyGuiE
Leave a Reply