Wam Microcap Ltd (ASX: WMI) is paying a dividend yield of 7.6%, or 10.9% including franking credits, despite reporting an operating loss for the full year.

The fund’s investment portfolio also underperformed, increasing just 0.1% for the year, while its benchmark, the S&P/ASX Small Ordinaries Accumulation Index, rose 8.1%.

Could do better, fund manager says

WAM Microcap Lead Portfolio Manager Oscar Oberg said regarding the result:

Following eight consecutive years of outperformance since listing, FY2026 was a challenging year for the WAM Microcap investment portfolio. The underperformance relative to the benchmark was primarily driven by our limited exposure to resources companies during a period of exceptionally strong performance from the sector, combined with stock selection that was not at the level we expect. The strongest headwind for the portfolio was the significant divergence between resources and industrial companies. While this positioning detracted from investment portfolio performance in FY2026, we believe our focus on identifying undervalued micro-cap industrial companies will continue to create opportunities for shareholders over the long term.

Mr Oberg said the managers believed the fund was well-positioned at the start of the financial year, and they remain confident in the opportunities in the microcap sector.

Since inception, WAM Microcap has increased 14.4% per annum, outperforming the S&P/ASX Small Ordinaries Accumulation Index by 7.4% per annum.

Dividend yield still looking healthy

Wam Microcap will pay its fully-franked dividend of 5.35 cents on October 29 to shareholders on the register on October 16.

The dividend is up slightly from 5.3 cents for the same period last year.

Some of the fund’s largest holdings include EDU Holdings Ltd (ASX: EDU), Artrya Ltd (ASX: AYA), and Echo IQ Ltd (ASX: EIQ).

The fund focuses on companies with a market capitalisation of less than $300 million at the time of acquisition.

Other Wilson funds also paying good dividend yields

The fund’s dividend yield is better than others in the Wilson Asset Management Stable, with WAM Strategic Value Ltd (ASX: WAR), WAM Active Ltd (ASX: WAA), and WAM Income Maximiser Ltd (ASX: WMX) all paying solid dividends, yet not up to that level.

WAM Strategic Value reported earlier this month that it would pay an increased, fully-franked dividend of 6.5 cents per share, up 8.3% on the previous year and representing a yield of 5.9%.

This increases to 8.4% once franking credits are factored in.

WAM Active is paying the same return as WAM Strategic Value; however, if you include capital gains, it returned 40.2% for the year to the end of June.

The post This fund just declared a dividend yield of better than 7% appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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.

I like exchange-traded funds (ETFs) because they can open the door to markets and industries that are harder to access through individual ASX shares.

There are a few funds I am watching presently because I can see a strong long-term reason for owning them.

Here are three currently on my watchlist.

Global X Semiconductor ETF (ASX: SEMI)

Semiconductors sit behind an enormous amount of modern technology.

Artificial intelligence has pushed chips further into the spotlight, but the opportunity extends across data centres, smartphones, vehicles, industrial automation, cloud computing, and connected devices.

The SEMI ETF provides exposure to 30 major companies involved in the development and manufacturing of semiconductors.

I like the idea of approaching this industry through an ETF because predicting which chip company will lead the next generation of technology is difficult.

Demand can also shift across the semiconductor supply chain. One period might favour chip designers, while another could benefit memory manufacturers or the companies producing the equipment needed to make advanced chips.

The SEMI ETF spreads the investment across established industry leaders, allowing investors to participate in the broader growth of semiconductor demand.

Technology spending can move in cycles, so I would expect plenty of volatility along the way. But over a long timeframe, I think increasingly powerful computing creates a strong reason to keep this fund on my watchlist.

VanEck Morningstar Wide Moat ETF (ASX: MOAT)

The MOAT ETF takes an approach that closely resembles how I would think about selecting individual shares.

The fund invests in US companies that have sustainable competitive advantages and are trading at attractive prices relative to their fair value.

That combination catches my eye. A strong competitive position can come from factors such as brand strength, switching costs, network effects, or cost advantages. These characteristics can help a business protect profits and continue investing as competitors try to take market share.

The valuation element is also important. Even an excellent company can produce disappointing returns if investors pay too much for it.

I think having both considerations built into the investment process makes the MOAT ETF an interesting alternative to simply buying the largest US businesses by market capitalisation.

Vanguard FTSE Asia ex Japan Shares Index ETF (ASX: VAE)

The VAE ETF is on my watchlist because I think Asia could offer some exciting long-term opportunities.

The fund invests across Asian markets, excluding Japan, Australia, and New Zealand, providing access to economies such as China, India, Taiwan, and South Korea.

This brings exposure to areas such as semiconductor manufacturing, online commerce, financial services, industrial development, and rising consumer spending.

I think the semiconductor exposure is particularly interesting, with Taiwan and South Korea playing major roles in the global technology supply chain.

There is also a much broader story. Rising incomes across parts of Asia could support businesses serving increasingly wealthy consumers for many years.

The VAE ETF will come with political, regulatory, and currency risks that can create periods of volatility. But I think the size and long-term growth potential of the region still make it worth watching.

Foolish takeaway

I think all three ETFs offer exposure to areas with strong long-term growth potential.

Semiconductors, high-quality US businesses, and Asia’s economic development could all create attractive opportunities over the coming decade.

As a result, these are three funds I would be comfortable considering for a long-term investment.

The post Why these ASX ETFs are on my watchlist appeared first on The Motley Fool Australia.

More reading

• 3 strong ASX ETFs for smart investors to buy and hold
• Down 21% in six weeks, what’s happened to SEMI ETF?
• 3 strong Vanguard ETFs to buy with $3,000
• Should investors be targeting the semiconductor boom?
• 3 ASX tech shares on the verge of rocketing to the moon

Motley Fool contributor Grace Alvino has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended VanEck Morningstar Wide Moat ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Turning $10,000 into $100,000 sounds like a big goal, but compounding can do surprising things when it is given enough time.

If I assume an average annual return of 9% and no further contributions, the maths gives us a good idea of what the journey could look like.

How long would it take?

At a 9% annual return, $10,000 would grow to approximately $100,000 after 27 years.

Of course, it is worth remembering that the share market will not return exactly 9% every year. There will be strong years, weak years, and probably some uncomfortable falls along the way.

But I think it shows what long-term compounding can achieve when an investment is given enough time.

How would I target a 9% return?

If I were choosing individual ASX shares, I would focus on businesses I believe can steadily increase their value over many years.

I would look for strong competitive positions, opportunities to reinvest money at attractive returns, capable management, healthy balance sheets, and markets with room for growth.

I would also spread my money across several businesses rather than relying on one company to deliver the entire result.

For investors who would rather avoid stock picking, an index-tracking fund could provide a simpler route.

The Vanguard Australian Shares Index ETF (ASX: VAS), for example, seeks to track the S&P/ASX 300 Index and provides exposure to hundreds of Australian shares through one investment.

There is no guarantee that the VAS ETF, or the Australian market generally, will deliver 9% per year from here. But broad diversification and reinvesting dividends would allow investors to capture whatever long-term return the market provides.

Could $100,000 come sooner?

It certainly could if the portfolio achieves a higher return.

Warren Buffett provides an extraordinary example of what sustained outperformance can do.

Berkshire Hathaway (NYSE: BRK.B)’s per-share market value compounded at nearly 20% annually between 1965 and 2025, compared with 10.5% for the S&P 500 including dividends.

I think Buffett’s approach offers some valuable lessons. He is known to look for businesses he understands, durable competitive advantages, strong long-term economic prospects, and managers who act like owners. Buffett then aims to remain patient and let compounding unfold.

Those sound like straightforward ideas. Applying them successfully for decades is much harder.

Even professional investors regularly struggle to outperform. S&P Dow Jones Indices found that 87% of actively managed Australian Equity General funds failed to beat their benchmark over the 15 years to the end of 2025.

Buffett is an investing legend for a reason.

Foolish takeaway

I think $10,000 can become $100,000 without requiring a spectacular investment idea.

At an average return of 9%, the journey takes around 27 years. The ingredients are patience, sensible investments, reinvested returns, and enough discipline to stay invested when markets inevitably become uncomfortable.

Beating 9% could bring the finish line closer. However, I would treat that as a bonus rather than something my plan depends on.

The post How to turn $10,000 into $100,000 with ASX shares appeared first on The Motley Fool Australia.

More reading

• Is $2 million really the new superannuation target?
• How much do I need to retire on $100,000 a year at 60?
• Which is the best Vanguard ETF? VAS, VGS and VDHG compared
• $500 a month into ASX shares: Here’s what that could be worth in 20 years
• How much superannuation do you need to retire at 55?

Motley Fool contributor Grace Alvino has positions in Vanguard Australian Shares Index ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. 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.