S&P/ASX 200 Index (ASX: XJO) investors in retirement will likely need dividend income to live off. Along with this, a priority should be protecting capital and de-risking your portfolio. However, it is important not to lose sight of the magical power of compounding at high rates of return. In my opinion, all ASX investors should target the maximum total return they can achieve for their risk profile.

Investors in retirement

As investors, we’re a motley crew. We all have motley goals, motley resources and motley risk appetite. Because of this, it is important to understand your own personal circumstances and invest accordingly. The below ASX stocks will be fantastic options for most investors in retirement, but not for all. 

I am a big fan of writing everything down so that you can refer back to your notes. Take the time to think about what you want to achieve by investing in ASX stocks. It will be much clearer if the following stocks are for you.

3 best ASX 200 stocks to buy now

Duxton Water Ltd (ASX: D2O)

Duxton Water is an alternative business, betting on the long-term value of water entitlements in Australia. The company owns a number of entitlements in various regions and leases these out to the agriculture industry. Management has forecast that the dividend can grow every 6 months for the next 2 years. 

Duxton is priced at a large discount to its monthly net tangible assets (NTA). At current prices, the stock should be able to weather more rain in the short term. Over the long term, the scarcity and price of water is expected to rise.

Duxton has a dividend yield of 4% or 5.7% grossed-up.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

This ETF holds a basket of 62 of the ASX’s best dividend-paying stocks. The composition of holdings has changed recently in line with market and economic conditions. The ETF has sold down the banks in order to buy more reliable dividend stocks.

Two of the top holdings now include BHP Group Ltd (ASX: BHP) and Wesfarmers Ltd (ASX: WES). Given the large number of delayed payments and cancelled dividends, a forward dividend estimate is more reliable than a trailing yield. Vanguard estimates a forward yield of 6.2% or 8.48% grossed-up.

Macquarie Group Ltd (ASX: MQG)

Macquarie may perform better than the other big ASX banks given its diversified operations. The group has significant operations in investment banking and asset management. Investment banking is often the most profitable during downturns, where there is a lot of capital raising and takeovers.

For FY21, Macquarie offers investors an estimated 3.91% partially franked dividend yield.

Foolish bottom line

Retirement is an opportunity to benefit from all your hard work and sacrifices. Selling down a portion of your portfolio in high-valued markets, mixed with taking dividends in cash during bear markets is a great way to fund your lifestyle as an investor in retirement.

More reading

• Afterpay share price rockets 50% in May, is it in the buy zone?
• Why these 3 ASX 200 blue chips could be set for growth this week
• Why the price of these ASX travel shares soared over 30% since mid-May
• 3 top ASX dividend shares to buy now
• 3 ASX 200 shares to watch this week

Motley Fool contributor Lloyd Prout has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool Australia owns shares of Wesfarmers Limited. The Motley Fool Australia has recommended DUXTON FPO. 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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In late morning trade the S&P/ASX 200 Index (ASX: XJO) has bounced back from a poor start and is pushing higher. At the time of writing the benchmark index is up 0.25% to 5,770.9 points.

Four shares that are climbing more than most today are listed below. Here’s why they are charging higher:

The Austal Limited (ASX: ASB) share price is up over 5% to $3.52. Investors have been buying the shipbuilder’s shares after it upgraded its FY 2020 guidance at the end of last week. One broker that has responded positively to this upgrade was Citi. This morning the broker retained its buy rating and lifted the price target on Austal’s shares to $4.05.

The CSL Limited (ASX: CSL) share price is up 3% to $284.46. Investors appear to be taking advantage of the biotherapeutics company’s recent share price weakness to top up positions. Even after today’s gain, CSL’s shares are down 17% from their 52-week high. Concerns over the pandemic’s impact on plasma collections has been weighing on the company’s shares.

The Fortescue Metals Group Limited (ASX: FMG) share price is up 3% to $14.30. The catalyst for this gain has been a jump in iron ore prices on Friday night. The spot benchmark iron ore price climbed above US$100 a tonne amid concerns over supply disruptions in Brazil because of the pandemic. According to CommSec, iron ore rose by US$4.50 or 4.7% on Friday to US$100.90 a tonne.

The Star Entertainment Group Ltd (ASX: SGR) share price has stormed almost 6% higher to $3.12. This follows the release of two announcements on Monday by the casino and resorts operator. The first was a new long-term gaming tax agreement with the New South Wales government. The other was the announcement that its Star Sydney business will reopen today. This will see private gaming rooms open and up to 12 food and beverage venues within the complex.   

More reading

• 3 top ASX dividend shares to buy now
• 5 ASX 200 winners and 3 losers from last week
• Why ASX iron ore miners may outperform this morning
• ASX 200 Weekly Wrap: Surging bank shares push ASX toward 6,000
• 5 things to watch on the ASX 200 on Monday

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Austal Limited and CSL Ltd. 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.

The post Why Austal, CSL, Fortescue, & Star shares are charging higher today appeared first on Motley Fool Australia.

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