Why I’m planning to make this my biggest ASX ETF holding

ASX-listed exchange-traded funds (ETFs) can be some of the most effective investments that Aussies can buy because of the investment exposure and instant diversification they can provide.

I don’t have a significant portion of my portfolio invested in ASX ETFs, but there’s a particular ASX ETF I’m expecting to build up my exposure to in the coming years: WCM Quality Global Growth Fund (ASX: WCMQ).

There are plenty of ways to invest in international shares, with some options enabling investors to follow an index for a very cheap fee.

For multiple reasons, I think this ASX ETF is an even more appealing investment.

High-quality shares

This fund aims to own a portfolio of between 20 to 40 stocks that primarily come from the high-growth consumer, technology and healthcare sectors.

WCM – the California-based fund manager of this ASX ETF – believes that corporate culture is the biggest influence on a company’s ability to grow its competitive advantages, which can also be called an economic moat.

I think it’s important to recognise that competitive advantages are key drivers for a business to protect and grow their profit.

For WCM, they want to see that the competitive advantages are improving, which I think is smart, as that suggests improving profitability as time goes on.

Over the long-term, I think high-quality shares are likely to deliver a better performance than the overall share market.

In the 10 years to February 2026, the strategy that this ASX ETF follows has delivered an average net return per year of 16.6%, outperforming the global share market benchmark by an average of approximately 3% per year. Of course, past performance is not a guarantee of future returns.

Global portfolio

One thing I think plenty of Aussie investors may be guilty of is not taking advantage of the great opportunities that are out there on the global share market.

The ASX only accounts for 2% of the global share market – there are lot of opportunities in the other 98% of the world.

But, instead of choosing a portfolio that’s weighted to just a few large US tech names, I like that the WCMQ ETF is invested in a variety of names across the world.

In terms of geographic exposure, only 55% of the portfolio was invested in the Americas at the end of February. Not just the US, but the whole of the Americas only had a 55% weighting. Europe with a 26% weighting and Asia Pacific with a 17% weighting are the other two main regions with a sizeable allocation.

Some of its current largest holdings include Siemens Energy, AppLovin, Taiwan Semiconductor, Western Digital and Rolls Royce.

Appealing dividend yield

Not only are the portfolio and returns impressive, but the fund also offers a very solid dividend yield.

The ASX ETF aims to give investors a minimum annualised cash yield of 5%, which I think is a great starting point.

Given how the portfolio has performed (a mid-teen net return), the ETF has been able to comfortably fund the yield and deliver good capital growth. With the investment strategy WCM employs, I’d optimistic the long-term returns can continue to be pleasing.

The post Why I’m planning to make this my biggest ASX ETF holding appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Wcm Quality Global Growth Fund. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Taiwan Semiconductor Manufacturing and Western Digital. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Rolls-Royce Plc and Siemens Energy Ag. 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.