If you’ve saved up $1,000 and are looking to invest right now, ASX exchange-traded funds (ETFs) could be the way to go.

ETFs essentially allow you to buy units in a fund that invests in a diversified portfolio of shares. These funds come in many forms and can be specific to a particular country, like Vanguard Australian Shares Index ETF (ASX: VAS), or a sector like the ETFS Morningstar Global Technology ETF (ASX: TECH).

So, before you commit your hard-earned cash to the share market, let’s check out some of the best ASX ETFs to buy today.

Why should I buy ETFs in the first place?

ETFs are a great way to achieve instant diversification. Portfolio construction is critical but it takes time and money. If you’re just looking to invest $1,000 today, this may only buy you a few shares in the S&P/ASX 200 Index (ASX: XJO).

For instance, the CSL Limited (ASX: CSL) shares are currently trading at nearly $300 each which will eat up the majority of your investment for a grand total of only 3 shares in one company. 

However, an ETF like the Vanguard Australian Shares Index ETF gives you broad exposure to the S&P/ASX 300. This ETF essentially tracks the market and means you’re a passive investor.

Investing in ASX ETFs isn’t for everyone and many investors prefer to select individual shares to buy. If you’re a relatively new investor, however, or you like the diversification offered by ETFs, here are a couple of top funds to consider today.

Where to invest $1,000 in ASX ETFs today

I think ETFs have a place in almost any portfolio. Buying ETFs is an easy way to diversify or even target a specific sector or geography.

For instance, If you’re bullish about tech, the ETFS Morningstar Global Technology ETF can top up your exposure without buying shares in each individual tech company.

VAS and TECH aside, iShares S&P 500 ETF (ASX: IVV) could be a strong buy if you’re bullish about the United States. Federal Reserve Chair Jerome Powell is doing everything he can to keep the economy ticking along right now and we could see some strong gains in US markets as a result.

If you’re after an all-in-one solution, the Vanguard Diversified High Growth Index ETF (ASX: VDHG) could be for you. This fund is a diversified global portfolio with a heavier weighting towards the ASX.

Either of these could be great options if you’re just looking to invest $1,000 in a diversified portfolio but don’t know where to start.

More reading

• How to tidy up your super in just 10 minutes this weekend
• These were the worst performing ASX 200 shares last week
• These were the best performing ASX 200 shares last week
• How these 3 ASX financial shares have proved their doubters wrong
• 3 ASX shares that I’d invest $1,000 into EVERY month

Ken Hall owns shares of Vanguard Australian Shares Index and Vanguard Diversified High Growth Index ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. and ETFS Morningstar Global Technology ETF. The Motley Fool Australia has no position in any of the stocks mentioned. 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.

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Last week the S&P/ASX 200 Index (ASX: XJO) was on form again and stormed 1.7% higher to end the period at 5,497 points.

While a good number of shares pushed higher last week, some climbed more than most.

Here’s why these were the best performing ASX 200 shares over the period:

The NRW Holdings Limited (ASX: NWH) share price was the best performer on the index last week with a 31.3% gain. Investors were buying the infrastructure contractor’s shares following the least of a trading update. That update revealed that NRW delivered unaudited revenue of $1.6 billion for the 10 months to April 30. This represents record revenue for the company compared to any previous full financial year. NRW’s earnings before interest, tax, depreciation, and amortisation came in at $177 million for the 10 months.

The Nearmap Ltd (ASX: NEA) share price was on form last week and jumped 22% higher despite there being no news out of it. This gain means the aerial imagery technology and location data company’s shares are now up a massive 53.5% since this time last month. Investors may believe that Nearmap’s shares had fallen too hard this year.

The Lynas Corporation Ltd (ASX: LYC) share price wasn’t far behind with a 21.8% gain. This looks to have been driven by a positive broker note out of Canaccord Genuity. It initiated coverage on the rare earths miner with a buy rating and a target price of $3.80. The broker believes that rare earth demand could recover in a post-COVID-19 world. It suspects this could lead to a shortage of the materials by 2023, placing upward pressure on prices.

The Orocobre Limited (ASX: ORE) share price was a strong performer last week with a 21.7% gain. This was despite there being no news out of the lithium miner. Last week the price of the battery making ingredient stabilised after heavy declines a week earlier. And with economies around the world now reopening, investors may believe that the worst is over for Orocobre and its peers.

More reading

• How to tidy up your super in just 10 minutes this weekend
• These were the worst performing ASX 200 shares last week
• Where to invest $1,000 in ASX ETFs today
• How these 3 ASX financial shares have proved their doubters wrong
• How to use ASX shares to become a millionaire

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Nearmap Ltd. 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 These were the best performing ASX 200 shares last week appeared first on Motley Fool Australia.

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It’s becoming easier and easier to forget but, back in March, the S&P/ASX 200 Index (ASX: XJO) was in the throes of the fastest bear market on record. Between 20 February and 23 March, the ASX 200 fell over 35% – losing more than a third of its value in just 4 weeks. 

Since then, the ASX 200 has rallied over 20% – assuaging some of the nasty losses many ASX investors experienced. 

But some ASX financial shares have gone one better than the index by at least doubling in value since those March lows.

Afterpay Ltd (ASX: APT)

Afterpay shares have performed extremely well since the lows in March when investors sent this company back down to the bargain basement at ~$8 per share. Today, Afterpay has printed a fresh, all-time high and has just this week broken the $45 mark for the first time. That’s an increase of over 400% in just two months – now that’s a good size gain!

EML Payments Ltd (ASX: EML)

EML Payments is another payments company the ASX has decided it may have misjudged in March. Back then, EML plumbed depths of $1.20 per share. This week, however, EML shares were commanding almost $3.80 per share. That’s more than a 3-bagger in just two months. Got FOMO yet?

Credit Corp Group Limited (ASX: CCP)

Credit Corp is another financial company that the markets have clearly re-rated since March. Much like Afterpay, investors were initially very concerned over this company’s credit risk when the scale of the economic fallout from coronavirus became clear. 

But it’s obvious the market’s worst fears back then are no longer expected to eventuate. Since Credit Corp touched lows of ~$6 per share on 23 March, the stock has more than doubled and was trading above $15 for most of the week.

Notice anything in common yet?

Why are these ASX financial shares storming higher?

Well, in my view it’s all to do with credit risk. When it became obvious that our economy was destined for a nasty recession as a result of the coronavirus pandemic, any company that held large amounts of debt or credit risk was clearly not the first choice for investors. Recessions usually involve higher rates of loan default, which can quickly cripple any business, but especially those who don’t enjoy the scale and government backing of the big ASX banks.

What’s more, new-age financials like Afterpay and EML have never been tested in a recession, so clearly investors weren’t really feeling like taking a chance on these companies back in March. However, things have changed since then. For instance, Afterpay has reported its service remains more popular than ever, and that it isn’t facing the wave of defaults investors feared.

Foolish Takeaway

It’s ASX shares like these that once again show the benefits of taking a contrarian position ‘against the crowd’. It’s not always wise to bet against the market, but if you do it successfully, the results can be extremely lucrative.

More reading

• How to use ASX shares to become a millionaire
• Is the Afterpay share price a buy at $44?
• Top brokers are urging you to buy this slumping ASX 200 stock next week
• 3 ETFs perfect for an ASX growth investor
• ASX 200 drops 1% on Friday

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Emerchants Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Emerchants Limited. 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 How these 3 ASX financial shares have proved their doubters wrong appeared first on Motley Fool Australia.

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