Author: openjargon

Deciding which ASX shares are buys and which ones are sells can be difficult. 

To help you figure things out, let’s look at three ASX shares that experts are tipping as sells this week, courtesy of The Bull. 

Here’s what they are saying:

CAR Group Ltd (ASX: CAR)

The team at Alto Capital is bearish on auto listings company CAR Group.

While it was pleased with its performance in FY 2026, it isn’t a fan of its valuation and believes the risk-reward is unfavourable for investors. It said:

CAR Group operates leading digital automotive markets in Australia and internationally. It delivered another strong result in fiscal year 2026. Reported revenue of $A1.253 billion was up 6 per cent on the prior corresponding period. Reported net profit after tax of $A314 million was up 14 per cent. International operations continue to generate attractive long term growth and management expects further revenue growth in fiscal year 2027. 

However, the company’s strong operating performance is increasingly reflected in its valuation, which requires sustained double digit growth and continuing successful international execution. In our view, the risk-reward balance in response to valuation supports a lighten recommendation.

Commonwealth Bank of Australia (ASX: CBA)

Red Leaf Securities has named CBA shares as a sell this week. While it acknowledges that CBA deserves to trade at a premium to peers, it believes a substantial re-rating leaves little room for disappointment. 

As a result, Red Leaf thinks investors should consider taking profit and focusing on areas with more reasonable valuations. It said:

CBA shares deserves to trade at a premium given its dominant retail franchise, strong technology platform, solid deposit base and consistent execution. However, Australian banking remains a mature industry, with intense competition across mortgages and deposits limiting the potential for outsized earnings growth. 

At a premium valuation, investors are paying a higher price for quality, leaving little room for disappointment. After a substantial re-rating, investors may be better served taking some profits and reallocating capital towards businesses offering stronger growth at more reasonable valuations.

Westpac Banking Corp (ASX: WBC)

The team at Red Leaf has also named Westpac shares as a sell this week.

It highlights the increasingly competitive environment as a reason to be cautious, especially given its valuation. It commented:

The bank remains well capitalised and continues to generate solid earnings, but the operating environment is becoming increasingly competitive. Mortgage pricing is aggressive, deposit competition remains intense and the scope for sustained margin expansion appears limited. Westpac’s dividend remains attractive, but investors should also consider opportunity cost. We believe there are more compelling opportunities on the ASX, which offer stronger structural growth or more attractive valuations.

The post Experts name CBA and these ASX shares as sells today appeared first on The Motley Fool Australia.

More reading

• How much do you need invested in ASX dividend shares to replace a $90,000 salary?
• 5 things Warren Buffett looks for before buying ASX shares
• 3 reasons to buy CBA shares following its results
• Want income for life? Here’s how I’d build an ASX dividend portfolio
• How much is needed in superannuation for $1500 in weekly passive income?

Motley Fool contributor James Mickleboro 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 CAR Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Friday, the S&P/ASX 200 Index (ASX: XJO) finished the week with a small decline. The benchmark index fell 0.25% to 9,058.9 points.

Will the market be able to bounce back from this on Monday? Here are five things to watch:

ASX 200 expected to rise

The Australian share market looks set for a solid start to the week following a good session on Wall Street on Friday. According to the latest SPI futures, the ASX 200 is expected to open the day 41 points or 0.45% higher. In the United States, the Dow Jones rose 1%, the S&P 500 climbed 0.45%, and the Nasdaq pushed 0.45% higher.

Oil prices rise

It could be a positive start to the week for ASX 200 energy shares Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) after oil prices rose on Friday night. According to Bloomberg, the WTI crude oil price was up 0.25% to US$87.06 a barrel and the Brent crude oil price was up 0.65% to US$94.39 a barrel. This was despite reports claiming that the Iranian government wants to end the war soon.

GYG shares downgraded

Guzman Y Gomez Ltd (ASX: GYG) shares are around fair value now following a recent rally according to analysts at Bell Potter. In response to the quick-service restaurant operator’s FY 2026 results, the broker has downgraded its shares to a hold rating with an improved price target of $27.30. It commented: “While we think GYG is a clear leader in the QSR space after displaying strong comp sales growth, margin expansion, and further network growth opportunities, we see near-term cost headwinds and a consumer slow-down as a risk to FY27 guidance and view the current multiple as fairly valued. While we increase our PT ~11%, it is only a modest premium to the share price, so we downgrade to HOLD.”

Gold price jumps

It is likely to be a strong start to the week for ASX 200 gold shares Capricorn Metals Ltd (ASX: CMM) and Northern Star Resources Ltd (ASX: NST) after the gold price jumped on Friday night. According to CNBC, the gold futures price was up 2.4% to US$4,680.6 an ounce. The precious metal hit a three-month high on US dollar weakness.

ASX 200 results

A number of ASX 200 shares will be on watch on Monday when they release their latest results. Among the names to watch are Dan Murphy’s owner Endeavour Group (ASX: EDV) regional bank Bendigo and Adelaide Bank Ltd (ASX: BEN), lithium leader PLS Group (ASX: PLS), and health insurance company NIB Holdings Limited (ASX: NHF).

The post 5 things to watch on the ASX 200 on Monday appeared first on The Motley Fool Australia.

More reading

• How much passive income can I earn off a $900,000 superannuation balance?
• ASX 200 healthcare shares soar 9% amid notable FY26 reports from CSL, Pro Medicus
• Brokers name the ASX 200 winners and losers from the first half of reporting season
• Why I’d still buy Guzman Y Gomez shares after its big rise
• Here are the top 10 ASX 200 shares today

Motley Fool contributor James Mickleboro has positions in Endeavour Group and Woodside Energy Group Ltd. 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 positions in and has recommended Bendigo And Adelaide Bank and NIB Holdings. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

BHP Group Ltd (ASX: BHP) shares have delivered a significant return in the last 12 months, rising by more than 50%, at the time of writing. The passive income has also been pleasing for investors.

As one of the biggest miners in the world, BHP enjoys significant scale benefits compared to many of its other smaller mining peers. BHP also has a habit of providing investors with pleasing payouts because of its commitment to returns.

BHP aims to provide shareholders with a minimum dividend payout ratio of at least 50% of earnings, which regularly results in a pleasing dividend yield.

Now that the FY26 result has been reported, investors can look ahead to what the payout might be in FY27. I’ll specifically look at what it would take to deliver $1,000 of passive income via BHP shares.

Payout projection for FY27

ASX mining shares are not like typical businesses where you may typically see steady progress and earnings year after year.

Miners like BHP are exposed to shifting commodity prices, which can be great when the resource price goes up but challenging if the resource price goes down. Commodity businesses can have powerful operating leverage that can work both positively and negatively.

The 2026 financial year was a good year. Revenue grew 15% to US$58.8 billion, underlying operating profit (EBITDA) rose 27% to US$32.9 billion and underlying attributable profit increased 30% to US$13.2 billion. This allowed the business to announce US$8.7 billion of cash returns to shareholders, which included the FY26 final dividend per share of US 99 cents per share.

The current forecast on Commsec implies the dividend in FY27 may not be as rewarding, though still solid. The current projection suggests a payout of A$2.07 per BHP share.

That possible dividend translates into a potential grossed-up dividend yield of around 4.5%, including franking credits, at the time of writing. It’s understandable why the possible dividend yield is not below 5% because the BHP share price has gone up so much in the last 12 months.

I believe the company’s payouts could grow in the longer-term because of its increasing focus on copper. Copper supply may not be able to keep up with the rising demand, which may lead to a rising copper price.

In the FY26 result, BHP wrote:

Copper fundamentals remain attractive. Demand is expected to grow from ~34 Mtpa today to >50 Mtpa by CY50, driven by traditional economic growth (home building, electrical equipment and household appliances), energy transition (renewables and electric vehicles) and digital (artificial intelligence and data centres). Current expectations are that copper demand associated with investment in data centres could grow around sixfold between 2024 and 2050, up to around 3 Mtpa.

Operational and project development challenges will place upward pressure on industry costs, potentially resulting in a higher and steeper copper cost curve.

What would it take for $1,000 of passive income?

If the FY27 projection comes true, an investor may need to own 484 BHP shares excluding the franking credits or 339 BHP shares with franking credits attached. This certainly isn’t a cheap BHP share price to invest at following the large rise of the ASX mining share. It may be worthwhile looking at other opportunities that could be better value.

The post How much must I invest in BHP shares to earn a $1,000 passive income in 2027? appeared first on The Motley Fool Australia.

More reading

• How much do you need invested in ASX dividend shares to replace a $90,000 salary?
• How much is needed in superannuation for $1500 in weekly passive income?
• 7 ASX 200 shares with reaffirmed buy ratings this week
• 10 ASX 200 shares downgraded by analysts this week
• My top 5 ASX 200 shares to buy and hold

Motley Fool contributor Tristan Harrison 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 BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Friday, Argo Global Listed Infrastructure Ltd (ASX: ALI) reported a full-year profit of $39.5 million for FY26, with a record fully franked dividend yield of 5.6%.

What did Argo Infrastructure report?

• Net profit after tax (NPAT): $39.5 million (down from $52.2m in FY25)
• Total assets: $529 million (up from $476m in FY25)
• Fully franked full-year dividends: 10.0 cents per share (a record high; up from 9.5c last year)
• Dividend yield: 5.6% (including franking)
• Portfolio performance: +13% (vs infrastructure index +9.5% and ASX 200 Accum. +6.1%)
• Total shareholder return: +19.2% for the year to 30 June 2026

What else do investors need to know?

Argo Infrastructure delivered its 17th consecutive fully franked dividend, bringing total dividends paid to shareholders since the company’s 2015 inception to 77.25 cents per share. The company’s diversified approach, managed by global specialist Cohen & Steers, has consistently outperformed across multiple timeframes.

AI-driven demand for data centres has spurred growth among holdings like Entergy, which gained 38% this year after securing a major power supply contract with Google. Exposure to utilities supporting technology giants such as Meta and Microsoft also contributed positively to returns.

What did Argo Infrastructure management say?

Managing Director Jason Beddow said:

We’re pleased that our global infrastructure portfolio not only delivered strong returns but continues to provide diversification and income for our shareholders, particularly in a year marked by volatility and rapid technological change.

What’s next for Argo Infrastructure?

Looking ahead, Argo Infrastructure expects the global listed infrastructure sector to remain resilient, underpinned by persistent demand for energy, especially from data centre expansion and digitalisation trends. While geopolitical and regulatory risks remain, the company sees ongoing opportunity in electric utilities and gas distribution.

Longer term, the board is optimistic that private investment in infrastructure, particularly connected to the rise in AI and cloud computing, will be essential as governments alone cannot meet soaring capital expenditure needs.

Argo Infrastructure share price snapshot

Over the past 12 months, Argo Infrastructure shares have risen 9%, outpacing the All Ordinaries Index (ASX: XAO), which is flat over the same period.

View Original Announcement

The post Argo Infrastructure FY26 earnings: Record dividend appeared first on The Motley Fool Australia.

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• How to build your superannuation the Warren Buffett way

Motley Fool contributor Laura Stewart has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, and Microsoft. The Motley Fool Australia has recommended Alphabet, Amazon, and Microsoft. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

On Friday, Energy Resources of Australia (ASX: ERA) revealed a half-year net loss after tax of $214 million, with revenue falling 21% to $25 million.

What did Energy Resources of Australia report?

• Revenue from ordinary activities down 21% to $25.0 million (HY25: $31.5 million)
• Net loss after tax widened significantly to $214.1 million (HY25: $35.4 million loss)
• Operating cash outflow of $97.4 million (HY25: $99.8 million outflow)
• Rehabilitation costs incurred of $101 million (HY25: $106 million)
• Rehabilitation provision increased by $134 million to $2.44 billion
• No interim dividend declared for the half-year

What else do investors need to know?

Energy Resources of Australia (ERA) continues to focus on the rehabilitation of its former Ranger mine, located within the culturally and environmentally sensitive Kakadu National Park. The company’s financial result was weighed down by an increase in rehabilitation provision costs, in particular from revisions to the Pit 3 capping methodology, which extended the closure timeline and expected costs.

At 30 June 2026, ERA held $1.07 billion in cash, term deposits, and security receivables, including $573 million in a Trust Fund controlled by the Commonwealth. ERA confirmed it has no debt. ERA’s shares have been suspended from trading since 15 June 2026, as majority owner Rio Tinto Ltd (ASX: RIO) pursues compulsory acquisition of the remaining shares. The acquisition timeline is delayed pending court appeal outcomes.

What’s next for Energy Resources of Australia?

ERA’s strategic priority remains the comprehensive rehabilitation of the Ranger Project Area, aiming for its potential reintegration into Kakadu National Park. Management now expects its funding reserves to cover rehabilitation out to late 2027, extending beyond the previous estimate.

Further studies and reforecasts are underway, especially after recent changes in Pit 3 capping methodology led to increased costs and an extended schedule. Additional funding will likely be necessary by Q4 2027 to meet the company’s rehabilitation obligations. ERA continues to work with government and stakeholders to ensure regulatory compliance and sustainable closure outcomes.

View Original Announcement

The post Energy Resources of Australia: Loss widens on higher rehabilitation costs appeared first on The Motley Fool Australia.

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Motley Fool contributor Laura Stewart 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. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

The share Rural Funds Group (ASX: RFF) looks like an excellent ASX stock to buy to me because it’s significantly undervalued.

Rural Funds is a real estate investment trust (REIT) that owns farmland across a number of sectors including cattle, almonds, macadamias, vineyards and cropping.

In a period when the RBA interest rate has increased multiple times, I think the market is underappreciating the business, presenting an opportunity to invest.

Let’s take a look at why I’m so interested in investing.

Significant discount

One of the main ways to value a REIT is to look at the net asset value (NAV) – that includes the value of property, the debt, the cash and so on. Rural Funds regularly reports its adjusted NAV to take into account the market value of its water entitlements.

If the unit price of the REIT is significantly below the NAV, then that means we can buy exposure to its portfolio of assets at a compelling discount.

Rural Funds reported that its adjusted NAV was $3.22 at the end of FY26, representing a 4.5% year-over-year increase, driven by property revaluations and the value of its interest rate swaps.

We’d have to pay a lot more to go and buy the farms today in our own names. With Rural Funds, we can buy exposure at a much lower price.

Currently, the Rural Funds unit price is trading at a 35% discount to its stated value.

Resilient distribution

Even if the market doesn’t recognise the value of the business by sending the Rural Funds unit price higher any time soon, we can benefit by getting a sizeable distribution yield. The yield is much larger now than it would be if the Rural Funds unit price was trading at parity with its adjusted NAV.

Its distribution history is pleasing. Rural Funds grew its distribution every year between FY14 and FY22 and has since been maintained despite higher interest rates.

The business has provided guidance that it will pay an annual distribution of 11.73 cents per unit again in FY27, representing a distribution payout ratio of 100%.

At that level, it offers a distribution yield of 5.6%.

I think the business can deliver rising payouts in the coming years because of the ASX stock’s organic rental growth.

Pleasing rental income

I think every business worth investing in needs to have organic drivers that can increase its value over time.

There are two aspects that are helping increase its rental income.

More than half of its rental income is linked to CPI inflation, while another 29% is growing annually at a fixed rate. Regular rental growth is a compelling element, in my opinion.

Another driver is development investing at the farms. Some of the investments help increase the productivity of the farm, while other investments are turning some farms to other crop types for better, more economic use.

I think Rural Funds will pay larger dividends in the coming years.

The post Why I’m planning to buy this cheap ASX stock next! appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Rural Funds Group. 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 positions in and has recommended Rural Funds Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Friday, Qualitas Real Estate Income Fund (ASX: QRI) reported a 6% increase in operating profit to $70.9 million for the year ended 30 June 2026, with monthly distributions rising to 8.60% p.a. by year-end.

What did Qualitas Real Estate Income Fund report?

• Total investment income up 9.5% to $88.3 million
• Operating profit grew to $70.9 million (from $66.9 million in FY25)
• Net assets attributable to unitholders rose 3.6% to $1.01 billion
• Distributions paid totalled 11.45 cents per unit, up from 13.21 cents in the prior year in dollar terms but lower per unit due to capital raising
• Entitlement offer raised $34.6 million in new capital

What else do investors need to know?

The trust’s portfolio remains 100% floating rate, with monthly cash distributions hitting an annualised 8.60% by June 2026. The manager reported no impairments or arrears across the loan book, with over 95% of exposure in senior loans and a weighted average loan-to-value ratio of 65%.

QRI units traded at a 3.75% discount to net asset value as at 30 June 2026, closing at $1.54 per unit against a NAV of $1.60, reflecting broader sector sentiment rather than a shift in underlying fundamentals. The year also saw the trust complete an entitlement offer, expanding and diversifying the loan portfolio in line with its investment strategy.

What’s next for Qualitas Real Estate Income Fund?

Looking ahead, the trust will continue focusing on capital preservation and reliable income generation for unitholders, supporting its strategy through active portfolio management and a disciplined approach to risk. Market reforms in housing policy and shifting investor demand are expected to support future growth, with QRI well positioned to capture increased investment opportunities in the residential property financing sector.

A distribution of 1.0875 cents per unit was declared post-balance date for August 2026, maintaining the trust’s monthly income focus. The management remains vigilant about changing market dynamics and remains committed to stability and risk-adjusted returns.

Qualitas Real Estate Income Fund share price snapshot

Over the past 12 months, Qualitas shares have declined 5%, trailing the All Ordinaries Index (ASX: XAO), which is flat over the same period.

View Original Announcement

The post Qualitas Real Estate Income Fund FY26 earnings appeared first on The Motley Fool Australia.

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• Qualitas Real Estate Income Fund announces July 2026 distribution

Motley Fool contributor Laura Stewart 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. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

Your superannuation is more than just a nest egg for retirement, it can also be a fantastic tool to generate a consistent passive income for when you stop working.

But how much passive income could a $900,000 balance actually generate each month?

Let’s take a look.

What passive income can I earn off my $900,000 superannuation balance?

To calculate your potential passive income, you simply need to multiply your total superannuation balance by the overall dividend yield of your portfolio.

But the catch is that the answer varies widely depending on what dividend yield you pick.

For example, $900,000 x 3% = $27,000 per year in dividend payments.

But if your portfolio has a slightly higher dividend yield of around 4%, your passive income will be higher. That’s because $900,000 x 4% = $36,000 per year in dividend payments. 

If your superannuation portfolio yields closer to 5%, you could earn $45,000 every year in dividend payments off the same superannuation balance ($900,000 x 5% = $45,000).

At a 6% yield, you could earn an annual passive income of around $54,000, and at 7%, it could be even higher, at around $63,000.

And so on… 

As your dividend yield increases, the passive income you can earn from your $900,000 superannuation balance also increases.

These figures are based on cash dividends before any tax or franking credit benefits.

I want to earn around $45,000 per year in passive income off my superannuation. What ASX shares should I invest in?

To earn around $45,000 per year in passive income from a $900,000 superannuation balance, you’d need a portfolio yielding around 5%. There is a large range of good-quality ASX shares around this level. 

Here are some of my top picks.

Transurban Group (ASX: TCL), Origin Energy Ltd (ASX: ORG), Woodside Energy Group Ltd (ASX: WDS) and Harvey Norman Holdings Ltd (ASX: HVN) are all good-quality ASX shares which yield around 5% at the time of writing.

What are my options if I want to go for an even higher yield around 7% or 8%?

Again, there are several options, but you need to be aware that higher yielding ASX shares are generally associated with higher risk.

But the good news is that your passive income will be higher if you strive for this target. A 7% or 8% yielding superannuation portfolio, around $900,000 in size, can earn between $63,000 and $72,000 in passive income over the course of a year.

There are still some good options to consider too. WAM Leaders (ASX: WLE), Atlas Arteria Ltd (ASX: ALX) and Beach Energy Ltd (ASX: BPT) all yield around the 7% to 8% level at the time of writing.

Diversification is key

If you want a portfolio yielding around 5% or even 7%, it doesn’t mean that every investment in that superannuation portfolio has to yield that level. It can be a combination that yields 5% or 7% overall.

And remember, you don’t need to invest the whole sum in one go. Start with a monthly investment and let compounding do some of the hard work for you.

I’d look at splitting my superannuation portfolio into investments across several different yielding assets, preferably across different sectors.

This diversification strategy means that if one asset drops in value, its performance can be offset by other ASX shares, leading to a more consistent overall result.

The post How much passive income can I earn off a $900,000 superannuation balance? appeared first on The Motley Fool Australia.

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Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Transurban Group. The Motley Fool Australia has positions in and has recommended Harvey Norman and Transurban Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Superannuation is naturally suited to long-term investing.

For many Australians, the money could remain invested for decades. That gives compounding plenty of time to work.

And I think some of Warren Buffett’s most famous investing principles fit that timeframe remarkably well.

Start with businesses you understand

Buffett has spent decades investing in companies whose economics he understands.

I think that is a sensible place to start when choosing ASX shares for a self-managed superannuation fund (SMSF).

Rather than chasing whichever sector is attracting the most attention, I would focus on businesses where I can clearly explain how they make money, why customers keep coming back, and what could make them more valuable over time.

That could include a major bank such as Commonwealth Bank of Australia (ASX: CBA), a resources giant such as BHP Group Ltd (ASX: BHP), or a healthcare business such as CSL Ltd (ASX: CSL).

The important point is not owning those particular companies. It is being able to understand the investment well enough to remain confident through inevitable periods of market volatility.

Look for lasting competitive advantages

Buffett has frequently focused on businesses with sustainable competitive advantages.

For an ASX investor, I would look for qualities such as strong brands, loyal customers, economies of scale, valuable technology, or services that would be difficult for competitors to replicate.

Pro Medicus Ltd (ASX: PME) is one example that comes to mind.

Its Visage medical imaging platform has become embedded within major hospital systems, where reliability and performance are extremely important. Replacing critical healthcare software is not something a hospital is likely to do casually.

That type of customer relationship can help a strong business keep growing for many years.

I think these are exactly the sorts of companies worth looking for when the goal is building wealth over decades rather than finding the next quick winner.

Let compounding do its job

Buffett’s extraordinary wealth was not created from one brilliant investment. A huge part of the story is the length of time his capital has been compounding.

Superannuation investors have an advantage here because retirement savings are usually invested over a very long period.

If a company can keep increasing its earnings, reinvesting successfully, and becoming more valuable, shareholders can benefit as that process continues.

This is why I would be reluctant to constantly trade a superannuation portfolio. A great business does not suddenly become a poor long-term investment because its share price has a difficult month.

Giving strong companies time can be one of the most important parts of the strategy.

You don’t have to pick shares

There is another Warren Buffett lesson I think is especially relevant.

Despite his remarkable success selecting individual companies, Buffett has repeatedly argued that most investors can do very well with a low-cost index fund.

Australians could apply that idea through a broad exchange-traded fund (ETF).

The Vanguard Australian Shares Index ETF (ASX: VAS), for example, provides exposure to hundreds of Australian companies through one investment.

An investor wanting greater international diversification could also consider a broad global fund or something like the iShares S&P 500 AUD ETF (ASX: IVV).

This approach removes the need to identify which individual companies will outperform. Investors can instead capture the returns generated by a large collection of businesses and concentrate on remaining invested.

That may sound less exciting than trying to find the next ten-bagger, but Warren Buffett’s philosophy has never been about making investing exciting.

It is about making sensible decisions and allowing time to work in your favour.

Foolish takeaway

I would not try to turn a SMSF portfolio into a replica of Berkshire Hathaway.

Instead, I would borrow the principles that have helped Warren Buffett invest successfully for decades: understand what you own, favour strong businesses, think long term, and avoid unnecessary activity.

For investors who enjoy researching shares, that could mean patiently owning a collection of high-quality ASX businesses.

For everyone else, a low-cost diversified ETF could make the process much simpler.

The post How to build your superannuation the Warren Buffett way appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino has positions in CSL, Commonwealth Bank Of Australia, and Vanguard Australian Shares Index ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Berkshire Hathaway, CSL, and iShares S&P 500 ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has recommended BHP Group, Berkshire Hathaway, CSL, Pro Medicus, and iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

I believe the ASX share market is the best place to find passive income opportunities due to the large dividend yields. ASX dividend shares are a great place to hunt for ideas.

When you combine a generous dividend payout ratio with franking credits, you can end up with an impressive dividend yield.

I’m going to highlight two listed investment companies (LICs) in this article, both of which offer impressive dividend yields.

LICs enable investors to invest in a portfolio of shares in a single investment. The structure allows the LIC to turn long-term investment returns into a steady (and rising) payout.

I’m going to talk about two of my favourites.

PM Capital Global Opportunities Fund Ltd (ASX: PGF)

This LIC targets global shares to generate impressive returns. Its investment focus can change over the years, but currently some of the themes it has invested in include European banks, industrial metals, healthcare, industrials, USA banks, consumer and staples, leisure and entertainment, and housing in Ireland and Spain.

It currently has 40 positions, which I think is ample diversification for a professionally-run portfolio.

Past performance is not a guarantee of future performance, but its portfolio has returned an average of 16.8% per year since December 2013. That level of return has allowed this ASX dividend share to deliver share price growth, a rising dividend and a good dividend yield.

Over the past year, the PM Capital Global Opportunities Fund share price has risen by well over 100%. Its annual dividend per share has been hiked every year over the past decade aside from FY23 when it maintained its payout. That’s an impressive record of reliability.

The business intends to hike its annual payout in FY27 by 10% to 16 cents per share. That translates into a grossed-up dividend yield of 6.8%, including franking credits, at the time of writing. I expect the future payouts will be even bigger.

WAM Leaders Ltd (ASX: WLE)

The other ASX dividend share I want to highlight is WAM Leaders, a LIC run by Wilson Asset Management (WAM) that targets large, quality ASX shares.

By being active with its holdings, rather than just passively holding the largest stocks, WAM Leaders has managed to deliver an average return per year of 12.1% since its inception in May 2016, outperforming the ASX share market by an average of close to 3% per year.

Currently, some of its ‘overweight’ investments are focused around real estate businesses and major property developers.

That investment style, as well as having a good understanding of macroeconomic conditions, has allowed WAM Leaders to hike its annual dividend per share every year since FY17.

Its latest annual dividend per share was 9.6 cents in FY26. That equates to a grossed-up dividend yield of 10.3%, including franking credits, at the time of writing.

The post Get paid huge amounts of cash to own these ASX dividend shares appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison 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.