I think one of the best things we can do for our children financially, aside from teaching them about money, is to invest in ASX shares for the long term and let compounding work its magic.

As a family, we like to occasionally invest for our child’s future. At some point, that money can provide for them in some way, whether that’s a lump sum for a specific purpose or regular dividends to contribute towards certain things.

For multiple reasons, we decided to invest in Future Generation Global Ltd (ASX: FGG).

Diversification

Future Global Generation is a listed investment company (LIC) that’s invested in the funds of more than a dozen fund managers. Some of the fund managers include Vinva, Life Cycle, Cooper Investors, Antipodes, Plato and Paradice.

That means the ASX share can provide investors like me with good diversification. The portfolio is invested in more than 3,000 underlying securities, which is amazing diversification in my view.

The portfolio is spread across a number of geographic regions, making it pleasingly diversified by market as well. Around half of the portfolio is invested in North America, approximately a fifth is invested in the UK and Europe, close to 10% is invested in Asia, approximately 5% in other developed markets, around 1% in emerging markets, and the rest is a cash position.

One of the most appealing aspects of Future Generation Global is that it donates 1% of its net assets to youth mental health charities. Some of the charities it supports include Youth Opportunities, Prevention United, Back Track, Big hArt, Happy Paws Happy Hearts and Smiling Mind.

Dividends

Future Generation Global is one of the most compelling ASX dividend shares around, in my view. It offers an attractive combination of a good dividend yield and rising payouts.

The business has steadily increased its annual payout each year since FY19. Many large ASX shares haven’t delivered consistent payout growth this decade amid COVID-19 and inflation headwinds.

The business has guided its regular dividend is going to be hiked by 5% to 8.4 cents per share. That translates into a grossed-up dividend yield of 7.5%, including franking credits, at the time of writing.

Few ASX businesses have a dividend yield that high and have increased their payout for as many years in a row.

If I want to access the dividends over time, then this is a very rewarding choice.

Total shareholder returns

A key reason why I wanted to choose this ASX share with my child in mind is that it’s a great choice for long-term compounding. By reinvesting the dividends, I think our Future Generation Global holding can increase in value.

The total shareholder return (TSR) measure tells investors how much of a return an investment has made when we include both the dividends and the capital growth.

Past performance is not a guarantee of future returns of course, but Future Generation Global has delivered an average TSR of 16.8% per year in the last three years and an average of 7.8% per year over the past decade.

This return is strong enough to help deliver pleasing compound growth over time.

The post The ASX share I just bought for my child appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Future Generation Global. 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.

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:

Commonwealth Bank of Australia (ASX: CBA)

Shaw and Partners has named this big four bank as an ASX share to sell this week.

It highlights that CBA shares continue to trade at a significant premium to peers despite its subdued earnings growth outlook. It said:

In our view, the stock trades at a significant premium to domestic peers and on historical valuations. While the bank maintains a high quality franchise and strong market position, earnings growth is expected to remain modest amid competitive lending conditions and regulatory pressures. 

Recent Federal Government initiatives aimed at increasing housing supply and improving affordability is likely to lead to intensifying competition across the mortgage market and place pressure on lending margins. Current valuations leave limited scope for further earnings driven upside. Investors may wish to take profits and re-deploy capital into opportunities offering stronger risk-adjusted return potential.

Fortescue Ltd (ASX: FMG)

The team at RaaS Group has named iron ore giant Fortescue as an ASX share to sell.

It thinks the outlook for iron ore is less appealing than other commodities. It said:

The iron ore producer generated revenue of $US16.966 billion in full year 2026, up 9 per cent on the prior corresponding period. Statutory net profit after tax of $US2.860 billion was down 15 per cent, which included a $US525 million non-cash impairment charge relating to the Iron Bridge project and a $US73 million compensation claim expense. The final, fully franked dividend of 46 cents a share was down from 60 cents a year ago. 

Capital expenditure and investment guidance in full year 2027 is forecast to increase on full year 2026. The outlook for the iron ore price isn’t as appealing as other commodities. The share price has fallen from $22.99 on May 14 to trade at $17.22 on September 10.

Woolworths Group Ltd (ASX: WOW)

Shaw and Partners has also named supermarket giant Woolworths as an ASX share to sell.

While it acknowledges that Woolworths is a quality business, it thinks investors should be taking profit after a recent rally and focusing on investments with a more attractive risk-reward profile. Shaw and Partners said:

The supermarket group has experienced a strong recovery in the past year, with the share price recently trading near the upper end of its historical range. While the company remains high quality with a leading position in Australian food retailing, much of the recent improvement appears to be reflected in the WOW share price. Earnings growth is expected to remain relatively steady rather than exceptional, limiting scope for further share price appreciation from current levels. 

Following the recent rally, investors may consider taking profits before re-allocating capital to opportunities with stronger growth potential and a more attractive risk-reward profile.

The post Experts name CBA and these big-name ASX 200 shares as sells this week appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Woolworths 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 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.

If you are looking for new additions to your portfolio, then it could be worth listening to what analysts are saying about the popular ASX shares named below, courtesy of The Bull. 

Here’s what they are recommending this week:

Aurizon Holdings Ltd (ASX: AZJ)

The team at Baker Young has named this rail freight operator as an ASX share to buy this week.

It likes Aurizon due to its positive outlook and attractive dividend yield. Baker Young said:

This coal and freight logistics firm delivered better than expected full year 2026 results, in our view. Revenue of $4.194 billion was up 6 per cent on the prior corresponding period and statutory net profit after tax of $362 million was up 19 per cent. A highly encouraging performance at its containerised freight division provides a long term opportunity, in our view. 

Strong global coal prices amid favourable weather conditions to date in New South Wales and Queensland should generate demand for export logistics. While competition for haulage contracts may lower margins, the business outlook remains positive. It was recently trading on an attractive dividend yield above 6 per cent.

NextDC Ltd (ASX: NXT)

Over at Shaw and Partners, its analysts have named data centre operator NextDC as an ASX share to buy.

It highlights that NextDC continues to benefit from strong demand for data centre infrastructure, which is being driven largely by the artificial intelligence boom.

The good news is that Shaw and Partners believes these structural growth tailwinds will persist for many years. It said:

The company continues to benefit from strong demand for data centre infrastructure, driven by cloud computing, artificial intelligence and increasing digitalisation across the economy. NXT is expanding capacity across key Australian markets and maintains a strong development pipeline to support future growth. 

While investment spending remains elevated, management continues to secure long term customer contracts that provide earnings visibility. With structural growth tailwinds expected to persist for many years, NXT remains well positioned to deliver attractive long term shareholder returns.

Temple & Webster Group Ltd (ASX: TPW)

Baker Young has also named online furniture and homewares retailer Temple & Webster as an ASX share to buy this week.

It is feeling upbeat on the investment opportunity here following a leadership change and its positive medium term growth outlook. It explains:

We don’t regularly play high growth consumer discretionary stocks, but we see an opportunity emerging in this online furniture and homewares retailer. The company delivered record revenue of $664.6 million in full year 2026, up 10.6 per cent on the prior corresponding period. It’s worth noting that new chief executive Susie Sugden was previously the chief marketing officer during the company’s highly successful infancy between 2016 and 2020. The company is focusing on improving margins, which, in our view, is conservative and prudent given the incredibly challenging conditions in the retail sector. 

We believe new management deserves an opportunity to rebase expectations in a sector offering medium term upside. Also, we believe accumulating a position is worth considering for those willing to take relatively high volatility risk.

The post Experts name 3 top ASX shares to buy this week appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Nextdc and Temple & Webster Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Temple & Webster Group. The Motley Fool Australia has recommended Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.