Having a spare $130,000 to invest in an ASX dividend portfolio is probably an unlikely scenario for most readers (as well as this writer). But that doesn’t mean it’s not a valuable thought exercise!

Building a portfolio of ASX dividend shares typically takes years, a lot of dedication and a lot of discipline. But it’s entirely achievable all the same.

So if this was my ASX investing goal, here’s how I would construct a $130,000 portfolio of ASX dividend-paying shares.

Macquarie Group Ltd (ASX: MQG) – $30,000

My first $30,000 would go to Macquarie shares. Macquarie is one of the best ASX financials in the current environment, in my view. Unlike the big four ASX banks, Macquarie’s earnings come from highly diversified streams, including from outside the country.

Traditional banking services like loans and mortgages only make up a small fraction of Macquarie’s total business. Much more instrumental is Macquarie’s well-regarded investment banking business, as well as its annuity-style asset management side, which I think are huge advantages in these uncertain times. 

On current prices, Macquarie is offering a trailing dividend yield of 4.15%, which normally comes partially franked. As such, I think Macquarie is a great financial company to start off our dividend portfolio.

WAM Research Ltd (ASX: WAX) – $40,000

WAM Research is actually a listed investment company (LIC), which means it primarily invests in other ASX shares rather than operating a business. But WAM Research has proven pretty deft at this, returning an average of 13.4% per annum (before fees) since 2010. 

The reason WAX shares are getting an oversize position in our hypothetical portfolio today is its massive dividend yield. On current prices, this LIC is offering a trailing yield of 7.22%, which typically comes fully franked.

Telstra Corporation Ltd (ASX: TLS) – $30,000

Telstra is a dividend stalwart and offers a compelling enough return on current prices (in my opinion anyway) to justify inclusion in a dividend portfolio.

Right out of the gate, Telstra is offering investors a fully franked 5.21% starting yield (including the special dividend Telstra pays). But I also think that the 5G network Telstra is investing heavily in right now will pay further dividends down the road (literally). I think this investment in the next-gen 5G technology will play out very well for this telco giant, but even if it doesn’t, there’s that healthy dividend to ease the pain!

Brickworks Limited (ASX: BKW) – $30,000

Brickworks is one of the oldest and proudest dividend shares on the ASX, in my view and well deserves a place in this dividend portfolio. Its core building materials business is a lucrative one for Brickworks, but it’s also very cyclical, which can be bad news for a dividend-paying company. Luckily, Brickworks nullifies this cyclicality by investing on other revenue streams, including real estate and a cross-ownership with dividend king Washington H. Soul Pattinson & Co Ltd (ASX: SOL).

This has enabled Brickworks to pay a dividend that has either been steady or grown for over 40 years. That’s some solid reliability, in my opinion. On current prices, Brickworks is offering a trailing dividend yield of 4.25%, which comes fully franked.

More reading

• Here are 2 ASX dividend shares with yields over 10%
• 3 ASX dividend shares I would buy to beat low rates
• How to reduce your work to part-time using ASX shares
• Here’s how I would put $10,000 to work on the ASX
• The latest ASX small caps broker picks to buy today

Motley Fool contributor Sebastian Bowen owns shares of Telstra Limited, WAM Research Limited, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Brickworks, Macquarie Group Limited, Telstra Limited, and Washington H. Soul Pattinson and Company 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 I would build a $130,000 ASX dividend portfolio right now appeared first on Motley Fool Australia.

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Last week saw a large number of broker notes hitting the wires once again. Three buy ratings that caught my eye are summarised below.

Here’s why brokers think investors ought to buy them next week:

Aristocrat Leisure Limited (ASX: ALL)

According to a note out of Goldman Sachs, its analysts have retained their buy rating but lowered their price target on this gaming technology company’s shares to $28.50. While the broker acknowledges that there is uncertainty in regard to how long it will take for its land based segment to recover from the pandemic, it believes it is better placed than its rivals due to its market leading suite of games. It also notes that it has a strong balance sheet, giving it the option to pursue acquisitions. I agree with Goldman Sachs and would be a buyer of its shares with a long term view.

Sonic Healthcare Limited (ASX: SHL)

Analysts at Citi have retained their buy rating and $32.50 price target on this healthcare company’s shares. According to the note, the broker believes Sonic Healthcare has a lucrative opportunity in the U.S. with COVID-19 testing. Even if it only wins a small share of the multi-billion dollar market, it suspects it could give its revenue and earnings a major boost. I think Citi makes some good points and Sonic Healthcare could be worth a closer look.

Volpara Health Technologies Ltd (ASX: VHT)

A note out of Morgans reveals that its analysts have retained their add rating but cut the price target on this healthcare technology company’s shares to $1.68. The broker made a small reduction to its price target after factoring Volpara’s recent $37 million capital raising into the equation. The proceeds will be used for general working capital purposes and to fund potential future acquisition opportunities. Overall, the broker believes Volpara is well placed for growth over the coming years and thus holds firm with its positive rating. I agree with Morgans and feel Volpara is a good option for investors looking for small cap exposure.

More reading

• Here’s how I would put $10,000 to work on the ASX
• Top brokers are urging you to buy this slumping ASX 200 stock next week
• Brokers name 3 ASX 200 shares to buy right now
• Where growth, income, and value investors can invest right now
• Why Aristocrat Leisure, Afterpay, Corporate Travel, and Sydney Airport are pushing higher

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended VOLPARA FPO NZ. The Motley Fool Australia has recommended Sonic Healthcare 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.

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I think that $1,000 can be enough to change your money mindset forever.

There are things holding a lot of people back. Maybe they don’t have the money confidence to start on the right path.

I believe it’s wrong to believe that you need some large amount of money to make a huge difference. Sometimes it’s more about a mental shift than requiring a $100,000 share portfolio to feel good.

$1,000 to help your money confidence

Before the coronavirus hit, many Aussies didn’t have $1,000 to be able to cover an emergency expense with its savings.  

Having money in the bank may not strike plenty of people as a necessary thing. Why have cash sitting there for emergencies if you’ve never had to experience living through an emergency? The problem is that emergencies don’t tell you in advance when they’re going to happen.

Having $1,000 always sitting there in a (high interest) bank account can give you a lot of confidence with your money. You’re able to ride through a problem if it occurs. Obviously having more savings would be even better, but one step at a time. You are freer to make the best decisions for your life. 

There are plenty of banks offering savings accounts like Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group (ASX: ANZ), National Australia Bank Ltd (ASX: NAB) and Bendigo and Adelaide Bank Ltd (ASX: BEN).

$1,000 to get your financial ball rolling

You don’t need $10,000 or $50,000 of money to start investing in shares. You can start building your share portfolio with just $1,000, or even $500. Share brokerage fees are so cheap these days.

Compound interest from shares can make you 10% a year whether you portfolio balance is $1,000 or $1 million.

You don’t need a huge deposit to start investing. You can build your money by investing a small amount now and invest more when things are safer and conditions are closer to normal.

What shares could be a good place to start? I think shares like Future Generation Global Invstmnt Co Ltd (ASX: FGG) and iShares S&P 500 ETF (ASX: IVV) could be very good long-term investments.

More reading

• Where to invest $1,000 in ASX ETFs today
• 3 ASX shares that I’d invest $1,000 into EVERY month
• Is Afterpay an ASX blue chip of tomorrow?
• 2 ASX 200 dividend shares to buy for income in 2021
• ASX 200 down 0.2%: Afterpay hits a record high, Aristocrat Leisure update disappoints

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. 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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