Category: Stock Market

The S&P/ASX 200 Index (ASX: XJO) is on course to end the week with a decent gain. In afternoon trade, the benchmark index is up 0.5% to 7,098.2 points.

Four ASX shares that have failed to climb with the market today are listed below. Here’s why they are dropping:

Magellan Financial Group Ltd (ASX: MFG)

The Magellan share price is down 9% to $8.84. Investors have been hitting the sell button today after the fund manager released another dismal funds under management update. Magellan revealed that its funds under management declined by 10% or $4.9 billion last month. Management also advised that its performance fees would not be material for the six months to 31 December.

Pointsbet Holdings Ltd (ASX: PBH)

The Pointsbet share price is down 2.5% to $1.63. This follows a poor night of trade for tech shares on Wall Street overnight. Investors were selling tech shares after strong US jobs data appeared to support the Federal Reserve’s aggressive rate hike plans.

Star Entertainment Group Ltd (ASX: SGR)

The Star share price is down a further 2.5% to $1.79. Investors have been selling this casino and resorts operator’s shares in recent weeks amid concerns over a proposed new gambling tax. Goldman Sachs warned that the “NSW government’s proposed casino tax reforms pose a significant earnings risk for SGR’s Sydney casino.” The Star share price is now down 30% since this time last month.

Zip Co Ltd (ASX: ZIP)

The Zip share price is down 4% to 60 cents. This may have been driven by profit taking from some investors after the buy now pay later provider’s shares rocketed higher in recent sessions. Even after today’s decline, the Zip share price is still up 12% since this time last week.

The post Why Magellan, Pointsbet, Star, and Zip shares are dropping today appeared first on The Motley Fool Australia.

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More reading

• Magellan share price crashes 9% amid major funds under management decline
• Could this ASX 200 casino operator be in for another year of pain in 2023?
• Why Alkane, Appen, Warrego Energy, and Zip shares are racing higher today
• Flying start: Magellan share price surges 11% in 2023
• Here are the top 10 ASX 200 shares today

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 positions in and has recommended PointsBet and Zip Co. The Motley Fool Australia has recommended PointsBet. 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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S&P/ASX 200 Index (ASX: XJO) shares are in positive territory again today. That sees the benchmark index up 0.8% in the first week of 2023.

Of course, not all ASX 200 shares have performed equally.

While the year is young, and we’re not quite through the final trading day of week one, below are the top three performers so far.

Gold stocks shining bright

The number two and number three top-gaining ASX 200 shares so far in 2023 are both blue-chip gold producers.

Coming in at number three is Ramelius Resources Limited (ASX: RMS). The Ramelius share price is up 9.4% this week as we head into the lunch hour, currently trading for $1.02 per share.

With an 11.8% share price gain this week St Barbara Ltd (ASX: SBM) takes the number two spot. St Barbara shares are currently swapping hands for 87 cents.

With no price-sensitive news out, both ASX 200 shares look to be beneficiaries of a rising gold price. Although bullion dipped overnight, it remains up 0.5% in the calendar year, currently trading for US$1,833 per troy ounce.

On Wednesday, the big gold stocks enjoyed some healthy tailwinds as gold prices hit US$1,855. That was up almost 14% since the recent 3 November lows.

The best ASX 200 share performer in 2023 to date

The winner by a nose is Silver Lake Resources Limited (ASX: SLR) which is up 12% in 2023 at the time of writing.

Silver Lake is also a gold miner and producer, with a market cap of just north of $1.2 billion.

With all three top-performing ASX 200 shares strongly focused on gold, it appears investors may be taking a bullish outlook on the demand for the yellow metal in the year ahead.

The post These are the top 3 ASX 200 shares in the first week of 2023 appeared first on The Motley Fool Australia.

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More reading

• ASX 200 lithium shares lead the market higher on Friday
• ASX 200 shares to rise by up to 7% in 2023: CBA
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares today
• Investing in ASX 200 shares? Here’s what to expect from the US Fed in 2023

Motley Fool contributor Bernd Struben 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.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to end the week on a positive note. At the time of writing, the benchmark index is up 0.5% to 7,100.9 points.

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

BHP Group Ltd (ASX: BHP)

The BHP share price is up 3% to $47.33. This follows a strong night of trade for the mining giant’s shares on Wall Street overnight. Investors appear to have been buying BHP and other miners on the belief that China’s recovery from the pandemic will boost demand for commodities.

Core Lithium Ltd (ASX: CXO)

The Core Lithium share price is up over 6% to $1.18. This follows a rebound in the lithium industry on Friday. In addition, on Thursday, Core Lithium revealed that it has shipped 15,000 dry metric tonnes (dmt) of 1.4% Li2O spodumene Direct Shipping Ore (DSO) from the Finniss Lithium Operation to a customer in China. Core Lithium sold the lithium at a price of $US951 per dmt, which values the shipment at approximately US$14.25 million.

Santos Ltd (ASX: STO)

The Santos share price is up 2% to $7.04. Investors have been buying Santos and other energy shares on Friday after oil prices rebounded overnight. This has led to the S&P/ASX 200 Energy index rising 1.9% this afternoon.

Winsome Resources Ltd (ASX: WR1)

The Winsome share price is up 34% to $1.68. This has been driven by the release of a drilling update from this lithium explorer this morning. According to the release, Winsome Resources reported 1.34% Li2O over 107.6 metres at a hole from the Adina project in Quebec, Canada. This included high-grade intersections of up to 2.21% Li2O over 30.0 metres from 41.0 metres to 71.0 metres.

The post Why BHP, Core Lithium, Santos, and Winsome shares are charging higher appeared first on The Motley Fool Australia.

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More reading

• ASX 200 lithium shares lead the market higher on Friday
• Why ASX lithium share Winsome Resources is surging 22% today
• Is the party over for these ASX 200 energy shares in 2023?
• Here are the top 10 ASX 200 shares today
• Core Lithium share price higher on China shipment update

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 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.

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Three ASX automotive shares could be buys in 2023 according to Citi analysts.

The three shares are Bapcor Ltd (ASX: BAP), ARB Corporation Ltd (ASX: ARB) and G.U.D. Holdings Ltd (ASX: GUD).

Let’s take a look at the outlook for ASX 200 automotive shares in more detail.

What’s the outlook?

Citi recommends multiple ASX 200 automotive shares amid a rise in new car sales.

Data from the Federal Chamber of Automotive Industries (FCAI) showed a 31.9% lift in SUV vehicle sales in November. New vehicle sales lifted 17.9% compared to November 2021. Passenger vehicles fell 0.8%. Toyota was the market leader during the month, with Mazda and Ford following next.

Citi analyst Sam Teeger, quoted in The Australian, said “consumer demand for new cars appears to be holding up” but remains cautious amid higher interest rates and cost of living pressures.

Bapcor is Citi’s “top pick” in small-cap auto. This is due to its “relatively less-discretionary product offering” and potentially “conservative fiscal 2025 consensus earnings”.

The analyst also rates ARB Corporation as a buy given its strong balance sheet, while G.U.D also gained a mention. In a note to clients cited by the publication, Teeger added:

While both ARB and GUD should benefit as (car manufacturer) supply recovers, we see ARB relatively better positioned due to its export growth potential and a stronger balance sheet.

Given ARB’s long-term growth prospects appear unchanged, we see the current
weakness as temporary and as an opportunity to get set in a quality long-term
growth story

ARB Corporation designs, manufactures and distributes four-wheel-drive and light commercial vehicle accessories. The company reported $52.7 million of net cash holdings in its FY22 results. Bapcor specialises in automotive aftermarket spare parts and accessories in Australia, New Zealand and Asia. GUD also manufactures, imports and distributes automotive products.

New December stats from the FCAI released yesterday show a 12.1% lift in new vehicle sales compared to December 2021. Passenger vehicles lifted by 3.1%, with Toyota again the market leader.

Share price snapshot

The Bapcor share price has slid 5% in the last year.

The ARB Corporation share price has slid 48% in the past 52 weeks.

The G.U.D. Holdings share price has fallen 32% in the last year.

The post 3 ASX 200 automotive shares worth buying despite headwinds: Citi appeared first on The Motley Fool Australia.

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More reading

• 3 ASX shares I’d buy after each fell by over 30% this year
• 3 ASX shares to buy for a possible recession next year
• Looking for bear market bargains? 3 ASX shares to buy before 2023
• Top brokers name 3 ASX shares to buy today

Motley Fool contributor Monica O’Shea 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 ARB Corporation and Bapcor. 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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Creating a passive income stream would be on many New Year’s resolution lists this year. Investors like you and I will be scouring the markets for dividend-paying investments to line our pockets.

However, the humble small-cap shares of the ASX are often overlooked during this undertaking.

It is important to remember there are more dividend opportunities in the Aussie market than just the big four banks and a few mining giants. Why is it important?… Because if you’re looking at a long time horizon, small-caps — on average — outperform the big end of town.

In my mind, that’s the equivalent of having your cake and eating it too! After all, there is no rule in investing that says you can’t have dividends and growth.

Which ASX small-caps I’d buy for passive income

To try and capture the best of both worlds, I’ve whittled my way down to two ASX small-cap shares that could provide phenomenal income. To make the list, these companies needed a market capitalisation between $300 million to $2 billion and provide a yield above 4%.

HealthCo Healthcare and Wellness REIT (ASX: HCW)

This first one is a little different from the rest, being a real estate investment trust (REIT). The HealthCo REIT was spun up by the HMC Capital team — the team behind the successful acquisition and repurposing of the former Masters’ portfolio from Woolworths in 2017.

As the name suggests, the REIT is focused on developing and managing a high-quality property portfolio leasing to a variety of healthcare tenants. These tenants include Chemist Warehouse, Griffith University, G8 Education, and Uniting Care Queensland.

Furthermore, the high occupancy of 99% and weighted average lease expiry (WALE) of 10.2 years are reassuring metrics for passive income certainty. This ASX small-cap share currently offers a dividend yield of 4.3%.

Smartgroup Corporation Ltd (ASX: SIQ)

Next up is a company that has had its share price battered and bruised over the past year. Shares in the salary packaging and novated leasing provider have sank 31% compared to a year ago, as shown below.

Relatively flat revenue and the loss of its contract with the Department of Education and Training Victoria have rattled shareholders. Nevertheless, the company has a proven history of delivering earnings and dividend growth.

At a price-to-earnings (P/E) ratio of 10.5, Smartgroup looks like a value opportunity for passive income and further upside. The trailing dividend yield is around 12.8%.

While I suspect this will fall in 2023, I believe dividends will still be solid thanks to Smartgroup’s thick profit margin — typically above 20%.

The post Hunting for passive income among ASX small-cap shares? Here are my top 2 picks appeared first on The Motley Fool Australia.

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More reading

• These are the highest-yielding ASX 200 dividend shares right now
• 2 ASX dividend shares to buy right now: Goldman Sachs
• Buy these ASX dividend shares for a passive income boost in 2023 – experts
• Buy these ASX dividend shares for a passive income boost: analysts
• Brokers name 2 ASX dividend shares to buy next week

Motley Fool contributor Mitchell Lawler has positions in Smartgroup. 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 Smartgroup. 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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If you want to make some long term investments but aren’t sure which shares to buy, then exchange traded funds (ETFs) could be the answer.

That’s because ETFs provide investors with an easy way to invest in a large number of shares through a single investment. This makes it very easy to construct a diverse portfolio with little effort.

With that in mind, listed below are two super ETFs that could be top buy and hold options for a balanced portfolio. Here’s what you need to know about them:

BetaShares Asia Technology Tigers ETF (ASX: ASIA)

The BetaShares Asia Technology Tigers ETF could be a super ETF for investors to look at in 2023. Especially now that China is finally reopening after the pandemic.

That’s because this ETF gives investors access to ~50 of the largest technology and ecommerce companies that have their main area of business in Asia (excluding Japan).

This means you’ll be buying a piece of tech giants such as Alibaba, Baidu, JD.com, Meituan Dianping, Pinduoduo, Samsung, and Tencent Holdings. These companies look well-placed for growth over the long term, which could make the ETF a great buy and hold option.

BetaShares NASDAQ 100 ETF (ASX: NDQ)

Another ETF that could be a super buy and hold option for investors in 2023 is the BetaShares NASDAQ 100 ETF. Especially after pulling back materially in 2022 amid weakness in the tech sector after interest rates were increased around the world.

The BetaShares NASDAQ 100 ETF could be a great option as it provides investors with exposure to the 100 largest non-financial companies listed on the NASDAQ stock market.

This includes many of the largest companies in the world such as Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla.

Given their positive long term outlooks, they could make the ETF a great long term addition to a portfolio.

The post 2 super ETFs for ASX investors to buy in 2023 and hold for a decade appeared first on The Motley Fool Australia.

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More reading

• $300 a month in these 3 ASX shares could make you a millionaire by retirement
• 3 quality ETFs for ASX investors to buy next year
• 3 excellent ETFs for ASX investors to buy in January
• 3 reasons to buy the BetaShares Nasdaq 100 ETF (NDQ) before 2023
• 2 high quality ETFs for ASX beginner investors to buy in 2023

Motley Fool contributor James Mickleboro has positions in BetaShares Nasdaq 100 ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended Betashares Capital – Asia Technology Tigers Etf. 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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The S&P/ASX 200 Index (ASX: XJO) appears set to end the first week of 2023 in the green, with ASX lithium shares helping it get there.

Stocks in the battery-making material are outperforming all others on the index today while their home sector – the S&P/ASX 200 Materials Index (ASX: XMJ) – leads the way.

Right now, the ASX 200 is up 0.35% at 7,088.5 points. Meanwhile, the materials sector has gained 2.21%.

And taking out the top spot among the ASX 200’s gainers right now is none other than lithium favourite Core Lithium Ltd (ASX: CXO). Its share price has gained 5.14% to trade at $1.17 at the time of writing.

.

Let’s take a closer look at how Core Lithium and its peers are performing on Friday.

ASX 200 lithium shares lead the index on Friday

ASX 200 lithium shares are outperforming once more today, with many on track to end the week in the market’s top spots. Here’s how some favourites are trading:

• The Pilbara Minerals Ltd (ASX: PLS) share price is up 4.3% right now, trading at $3.88 apiece
• Shares in Mineral Resources Limited (ASX: MIN) have risen 3.38% to reach $80.76
• The IGO Ltd (ASX: IGO) share price has climbed 3.1% to swap hands for $13.85
• Lake Resources NL (ASX: LKE) stock is up 3.87% at 81 cents

And that’s just today’s gains. The Core Lithium share price has jumped more than 13% over the last week, as has that of Sayona Mining Ltd (ASX: SYA).

What else has been going on with ASX lithium giants this week?

Interestingly, there hasn’t been all that much news from ASX 200 lithium shares this week.

Though, Core Lithium did announce the maiden shipment of lithium from its Finniss Project yesterday.

Additionally, Mineral Resources hit the headlines on the back of what seems to be an error in a release detailing its off-market takeover bid for Norwest Energy NL (ASX: NWE).

An accompanying bidder’s statement listed Strike Energy Ltd (ASX: STX)’s ABN in place of Norwest’s, perhaps suggesting the latter energy stock could also be a takeover target.

Mineral Resources was also rumoured to have been behind large trade in Warrego Energy Ltd (ASX: WGO) stock. That’s particularly interesting due to the takeover battle currently at play between Gina Rinehart and Strike.

The post ASX 200 lithium shares lead the market higher on Friday appeared first on The Motley Fool Australia.

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More reading

• ASX 200 shares to rise by up to 7% in 2023: CBA
• 3 ASX growth shares to buy with huge upside potential – analysts
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares today
• Investing in ASX 200 shares? Here’s what to expect from the US Fed in 2023

Motley Fool contributor Brooke Cooper 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.

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S&P/ASX 200 Index (ASX: XJO) shares have just flipped the calendar on a year to forget.

Pressured by China’s growth hampering COVID lockdowns and fast rising interest rates across the world to combat soaring inflation, ASX 200 shares fell 5.5% in 2022.

The smaller end of the market had an even tougher time, with the All Ordinaries Index (ASX: XAO) dropping 7.2% over the year.

This was a stark contrast to the strong run in 2021. That year saw ASX 200 shares charge 13% higher while the All Ords gained 13.6%.

Add in dividends, and total returns for All Ords shares (share price moves plus dividends) came in at 17.7% in 2021, according to data from the Commonwealth Bank of Australia (ASX: CBA).

In 2022, however, the All Ords total returns fell by 3%.

Though that’s still a lot better than the hefty losses suffered in United States markets and across most European and Asian exchanges.

“There’s no doubt that Aussie share market investors had a tough year in 2022. But the good news is that Australian share indexes held up better than in most other advanced markets due to an outperforming economy,” CommSec chief equities economist Craig James said.

That’s a look in the rearview.

So what can investors in ASX 200 shares expect for 2023?

Well, perhaps not the same bull run we enjoyed in 2021. But it should be a heck of a lot better than the year just passed.

Economists at CBA forecast that the ASX 200 will post full-year share price gains in the range of 4% to 7%.

ASX 200 shares to rise by up to 7% in 2023

CBA’s economists note that their forecast remains dependent on inflation pressures, interest rate changes by major central banks and the ongoing economic recovery in China.

They expect one more 0.25% interest rate increase from the RBA in February, forecasting potential rate cuts later in the year. Australia’s economic growth is forecast to slow to 1.1% in 2023, from 3.5% last year.

As for which ASX 200 shares may outperform, CBA reported that consumer discretionary, information technology, property and smaller companies “may be favoured” from the second half of 2023.

The bank foresees ongoing challenges for the energy and materials sectors, which strongly outperformed in 2022.

Risks and opportunities

Commenting on the risks and opportunities ahead for investors in ASX 200 shares in 2023, James said:

High levels of inflation, continued uncertainty about interest rates, tight labour markets, high energy prices, the war in Ukraine and the re-opening of the Chinese economy pose both risks and opportunities for investors.

While the coming year certainly won’t be without its challenges, we are tipping a modest gain for the benchmark S&P/ASX 200 index in 2023 of 4-7 per cent to near 7,350-7,550 points.

Wishing you happy and prosperous investing in the New Year!

The post ASX 200 shares to rise by up to 7% in 2023: CBA appeared first on The Motley Fool Australia.

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More reading

• ASX 200 lithium shares lead the market higher on Friday
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares today
• Investing in ASX 200 shares? Here’s what to expect from the US Fed in 2023
• Why is this ASX 200 gold share rocketing 7% on Thursday?

Motley Fool contributor Bernd Struben 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.

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The Rio Tinto Ltd (ASX: RIO) share price was a strong performer in 2022.

As you can see below, the mining giant’s shares rose 16% over the 12 months.

As a comparison, the S&P/ASX 200 Index (ASX: XJO) recorded a 5.5% decline over the same period.

And let’s not forget dividends. Rio Tinto rewarded its shareholders with total fully franked dividends of $10.46 per share during the year. Based on the Rio Tinto share price at the end of the year, this equates to a 9% yield.

Why did the Rio Tinto share price beat the market?

There were a couple of drivers of Rio Tinto’s impressive share price gains in 2022.

The first was the release of a record-breaking full year result in February. For the 12 months ended 31 December 2021, the miner reported a 58% increase in underlying EBITDA to a record of US$37.72 billion.

This allowed the Rio Tinto board to increase its full year dividend by 87% year over year.

And while Rio Tinto’s half year results for FY 2022 in July didn’t go down as well with investors, that was all forgotten late in the year when the iron ore price surged higher.

The benchmark iron ore price climbed above US$100 a tonne amid optimism that the easing of COVID restrictions in China could cause a spike in demand for the steel making ingredient. Particularly given the prospect of major stimulus policies to support the country’s economic recovery from the pandemic.

Given how important iron ore is to Rio Tinto’s earnings, investors appear confident that these strong iron ore prices will underpin another solid full year result for the miner.

Investors won’t have long to wait to see if that is the case. The mining giant is scheduled to release its results on 22 February.

The post What drove the Rio Tinto share price 16% higher in 2022? appeared first on The Motley Fool Australia.

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More reading

• How buying this ASX 200 share could boost my annual dividend income by 17%
• My plan to turn $5 a day into a passive income in 2023
• 5 things to watch on the ASX 200 on Thursday
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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 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.

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There’s a large element of safety that comes from a portfolio of, say, blue-chip ASX shares.

However, I believe there’s a way to invest in a particularly safe manner while simultaneously taking advantage of opportunities offered by ASX growth stocks.

How, may you ask? Diversification.

I could diversify with ASX growth shares to boost returns

If I were to boast a portfolio of ASX shares I believe could consistently provide a 5% annual return, I might feel relatively safe in my investments.

As per the rule of risk versus reward, it’s likely that such a modest (though decent) return would offer a large degree of safety.

But there is a way I could bolster my returns without compromising such safety. That is, creating a shadow portfolio of ASX growth shares.

As the name suggests, growth shares generally represent up-and-coming companies in the early-to-mid phases of their growth.

Thus, they rarely offer dividends. They can also be particularly susceptible to rate hikes, as they often fund their growth through debt.

Such factors mean many growth stocks suffered through 2022. And while their pain probably isn’t over yet – many commentators expect interest rates to increase in the coming months before easing in late 2023 – several quality growth stocks are likely trading at a decent discount right now.

In fact, my Fool colleague James recently outlined three stocks brokers are tipping to gain as much as 52% in the coming year.

But I would personally aim for a more modest yearly return. For instance, I think 15% sounds reasonable.

How I might aim to grow my annual returns by 40%

At that rate, if I were hoping to up my annual returns by 40%, I would probably build my growth holdings to be around a fifth of the size of my main portfolio.

After identifying an assortment of ASX shares I believe could grow 15% annually on average, my anticipated returns could look like this:

Portion of my holdings	Expected annual return
80%	5%
20%	15%
100%	7%

As readers can see, I could feasibly bump my expected annual return from 5% to 7% – a 40% increase – by building a shadow portfolio of ASX growth shares a fifth of the size of my core portfolio.

Though, no investment – no matter how considered – is guaranteed to provide either returns or downside protection.

Additionally, as discussed, higher returns generally come with higher risks.

Risk management

However, in my opinion, adding some growth shares to an otherwise entirely blue-chip portfolio is itself a form of risk management.

That’s because diversification is one of the most effective ways to manage the risks involved with investing. Though, there’s no way to entirely abate the risk of loss.

The post How an ASX growth portfolio could boost my annual returns by 40% appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper 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.

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