ASX financials are leading the other major sectors during Monday’s session, having broken away from the pack in early trade.

The S&P/ASX 200 Financials Index (ASX: XFJ) has climbed more than 2% into the green during the session, leading Australian large caps in the S&P/ASX 200 Index (ASX: XJO) by over 100 basis points.

Australian commodity stocks have fared tremendously well these past few weeks amid a fierce rally which commodity baskets are staging on global markets.

However today, the sector has pared gains such that the S&P/ASX 300 Metals & Mining Index (ASX: XMM) is trading around 27 basis points into the red at the time of writing.

What’s up with ASX financials today?

Even more interesting is the relationship between these two sectors over the past month or so. Traditionally – in the large cap space anyway – both mining and bank shares are viewed as more defensible sectors, not in the least due to the sizeable dividends on offer and robust company earnings.

That’s meant that, over the course of time, the two sectors have behaved relatively similar, ceteris paribus. However, with sector-specific risk and return factors at play, the pair have become less related in recent times.

Within the banking space, saturation of the mortgage market, pressures to net interest margin and of course record low base rates have hurt earnings in recent years.

Whereas recently, as close as 2022, the mining sector has benefited from record prices in the commodity markets as mentioned above.

The result is that as of March, both the metals and mining sector and the ASX financials have moved in almost inverse fashion, shown below.

ASX financials are flying today, led by Commonwealth Bank of Australia (ASX: CBA), currently up 2% on the day, followed by National Australia Bank Ltd. (ASX: NAB) up less than 2%.

Shares in Australia and New Zealand Banking Group Ltd (ASX: ANZ) are also up around 2% today, alongside Westpac Banking Corporation (ASX: WBC) shares which are up less than 2%.

Checking data provided by Bloomberg Intelligence, we see some interesting patterns today with flows into exchange traded funds (ETFs) backing these sectors.

The most funds’ have left European based “UCITS” type ETFs, whereas the heaviest inflows have been into Australian Government bond ETFs and long-biased ASX equity market ETFs.

Curiously, the BetaShares S&P/ASX Financial Sector ETF (ASX: QFN) has seen an 0.86% surge of inflows today, and is up 2.5%, whereas the BetaShares Australian Resources Sector ETF (ASX: QRE) has seen reasonable outflows and is in the red.

Why are ASX financials charging higher?

In the absence of any market specific events, it appears that the impact of inflation is a large factor according to Bloomberg economist James McIntyre. He notes that, whilst Australia might be the beneficiary of this latest commodities rally, the end-markets might not be so lucky.

“Surging commodity prices deliver a major windfall to Australia, one of the world’s largest commodity exporters”, McIntyre wrote.

“But the jackpot comes with a cost: higher inflation – particularly food and gasoline, which account for a hefty chunk of household budgets. The Reserve Bank of Australia will have to tighten [policy] a lot sooner to contain these pressures”.

That would involve raising base rates in order to increase the cost of money, that being interest, so as to reduce the level of aggregate spending and credit creation in the economy.

But the prospect of raising rates is good for some and not so good for others. Whilst a hike in commercial mortgage rates is a negative for the consumer, for the banks holding those mortgages, it’s a huge positive.

“..if the average discount variable mortgage rate was to rise by 2.15%, as predicted by the market, average monthly mortgage payments would rise by 29% from their February 2022 level and 69% nationally from 2015”, Lieth van Olselen, Chief Economist at MB Super says on Macrobusiness.

“The impact would be even more severe for the circa $500 billion worth of fixed rate mortgages due to expire over the next two years, most of which were originated at rates of under 2.5%”, he added.

So whilst mortgage-holders are up for a higher bill, for Aussie banks, this is a huge positive – a 29% net increase at the gross interest level would feed more down into net profit, free cash flow, and cash on the balance sheet.

In fact, see the impact of rising home prices/mortgages, shown in both absolute and inflation-adjusted terms, versus the aggregate of Australian banks’ balance sheets (red), on the chart below.

The uptick in prices is a positive for the banking sector’s financial health.

And that could mean higher dividends for eligible shareholders too, not to mention if earnings increase, the attraction from analysts as well.

The post Why ASX 200 bank shares are storming higher today appeared first on The Motley Fool Australia.

More reading

• The CBA (ASX:CBA) share price has gone nowhere in 10 months… time to buy?
• 2 buy-rated ASX 200 dividend shares with top yields
• Top brokers name 3 ASX shares to sell next week
• Is the NAB (ASX:NAB) share price a buy? Top broker expects sector-leading earnings growth
• The ANZ (ASX:ANZ) share price has toppled 16% in 15 years. Have the dividends been worth the pain?

Motley Fool contributor Zach Bristow 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 Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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It’s pretty easy to see the benefits of investing in ASX shares, or sharemarkets around the world for that matter, when markets are rising. The S&P/ASX 200 Index (ASX: XJO) gained a very healthy 13% or so over 2021. And that followed even healthier gains across the second half of 2020.

As such, it was very easy to see the kinds of gains one might be a party to if one invested across those periods. Not to mention the potential cash that one would miss out on if they didn’t.

But 2022 thus far has given investors a different tale. We are now in mid-March. Yet still the ASX 200 remains in the red year to date. Since the start of 2022, the ASX’s flagship index has lost 5.82% of its value. Suddenly, it’s a lot harder to convince a new investor of the benefits of investing in the share market.

And that difficulty has been compounded by the wild gyrations we have seen more recently in light of the tragic war in Europe. The world certainly seems an uncertain place right now. And when it costs almost double what it did even a few weeks ago to fill up your car, it can be hard to even contemplate ratcheting up investments into shares. 

Global uncertainty doesn’t always mean we shouldn’t invest in ASX shares

But even if the world has become, or even remains, a more uncertain place, it doesn’t mean that investing has automatically become a bad idea. As our Chief Investment Officer here at the Fool, Scott Phillips, has reminded us many times, the share market has seen more than its fair share of wars and other awful geopolitical events over decades and decades. And it has never not gone on to eventually enjoy subsequent new record highs. 

An article in the Australian Financial Review (AFR) today argues that while the world might indeed stay at a more uncertain level than perhaps we’d like, that might still open up new opportunities for investors. For example, the article quotes intelligence advisor Andrew Shearer, who argued Australia might need to become more self-reliant in the face of global supply chain instability:

This will include sharply increasing defence spending. But also building stronger manufacturing capability at home and shortening supply chains by pulling back from the globalised just-in-time world we knew before the pandemic.

Commodities are also an area that is highlighted. The AFR quotes Matthew Klein on this matter. He said that “a synchronised surge in demand for physical goods will continue to put upward pressure on industrial commodity prices, especially since many of those commodities used to come from Russia”.

We’ve arguably already seen some of the effects of this in the ASX’s resources shares in recent weeks. Shares like BHP Group Ltd (ASX: BHP), Paladin Energy Ltd (ASX: PDN,) and Woodside Petroleum Limited (ASX: WPL) are lifting.

So while the world may be moving towards a period of higher uncertainty than what we’re used to, that doesn’t mean we shouldn’t be investing. 

The post Why now is a great time to invest in ASX shares (even if you’re fearful of an uncertain world) appeared first on The Motley Fool Australia.

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• ASX 200 (ASX:XJO) midday update: Elders jumps, Magellan and Zip tumble
• 2 punished ASX shares that don’t deserve to be (and experts are buying)
• Down 14% in a month, why the Pilbara Minerals (ASX:PLS) share price is attractive right now: analyst
• These were the best performing ASX 200 shares last week
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Motley Fool contributor Sebastian Bowen 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 Bruce Jackson.

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The Treasury Wine Estates Ltd (ASX: TWE) share price has made significant ground this month.

The company’s shares have surged nearly 10% from market close on 14 February. The Treasury Wine share price is currently trading at $11.69, up 1.3% on Friday’s close.

Let’s take a look at what is happening at Treasury Wine.

Treasury Wine share price surges ahead

The Treasury Wine share price has turned its fortunes around in the past month after a tough start to the year. The wine giant’s share price fell nearly 15% between market close on 31 December 2021 and 15 February 2022 before picking up again.

On 16 February, Treasury Wine shares surged nearly 12% on the back of the company’s financial results. Despite a 7.5% drop in net profit and a 6.7% fall in EBITS, the company expressed optimism on its future outlook.

Commenting on this future agenda, chief executive officer Tim Ford said:

We have great confidence that by leveraging the unique strengths of our business – our people, our brands and our asset base – we are well placed to capitalise on the significant opportunities across the global markets in which we operate.

Treasury Wines shares dropped 2.74% on March 2. This was ex-dividend day for the company, as my Foolish colleague Aaron reported. The board maintained a fully-franked interim dividend of 15 cents per share. This will be paid on 1 April.

Morgans recently recommended Treasury Wine as an “add” with a $13.93 price target. That’s 19% more than the current share price.

The broker said:

The foundations are now in place for TWE to deliver strong double digit growth from the 2H22 over the next few years. Trading at a material discount to our valuation and other luxury brand owners, TWE is a key pick for us.

Share price snapshot

The Treasury Wine Estates share price has leapt nearly 5% in the past year, although it is down nearly 6% year to date.

For perspective, the S&P/ASX 200 Index (ASX: XJO) has returned around 5.5% in the past year.

Treasury Wine has a market capitalisation of about $8.4 billion based on its current share price.

The post Why has the Treasury Wine (ASX:TWE) share price surged 10% in a month? appeared first on The Motley Fool Australia.

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• Broker names 3 of the best ASX 200 shares to buy in March
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• Cheers! Broker tips 20% upside for the Treasury Wine (ASX:TWE) share price
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• 3 of the best results on the ASX 200 last week

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 Treasury Wine Estates Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Virtus Health Ltd (ASX: VRT) share price is soaring more than 7% higher on Monday after the release of a company announcement.

Shares in the reproductive health company and day surgery provider had been on ice since Friday pending an announcement on an acquisition offer from CapVest Partners LLP.

As a result of the share price increase today, Virtus also thrust past its 52-week trading high during the session.

Why is the Virtus health share price charging higher?

The company advised it has signed a transaction implementation deed with an entity controlled by CapVest Partners.

Under the deed, CapVest will acquire 100% of Virtus shares by a scheme of arrangement. The offer values Virtus at $8.25 cash per share, less the value of any dividends or distributions declared or paid after today.

At the time of writing, Virtus shares are trading at $8.25 apiece. They had closed the day flat at $7.70 on Thursday last week prior to being frozen on Friday.

As part of the deed, CapVest will make a simultaneous off-market takeover offer “conditional on the Scheme failing and a 50.1% minimum acceptance condition, offering total value of $8.10 per share less the Permitted Distributions”.

According to Virtus’ announcement, the company’s board unanimously recommends the offer, in the absence of a superior proposal and subject to expert review to gauge if it’s in the best interest of shareholders.

The board said it may also elect to pay a fully franked special dividend to 44 cents per share in total dividends before the implementation date.

What now?

Virtus noted that the details laid out within the transaction deed are fully funded and binding.

The deal is subject to “limited conditions, and is not subject to any conditions within the control or discretion of CapVest”, the company said.

With respect to the special dividend, there may be tax implications and the amount payable is related to the takeover offer, Virtus said.

“Eligible shareholders may receive the benefit from these franking credits, subject to their marginal tax rate,” the company remarked.

“The amount payable by CapVest under the Scheme or Takeover Offer will be reduced respectively by the amount of any such special dividend.”

In the last 12 months of trading, the Virtus Health share price has soared 37% and now is up 21% for the year to date, well ahead of the S&P/ASX 200 Index (ASX: XJO)’s return of around 4% in 2022.

The post Virtus Health (ASX:VRT) hits 52-week high, accetps CapVest bid appeared first on The Motley Fool Australia.

More reading

• Why CSL, Dicker Data, Elders, and Virtus Health shares are charging higher
• Why is the Virtus Health (ASX:VRT) share price frozen today?
• Why are investors selling the Virtus Health (ASX:VRT) share price post-earnings today?

Motley Fool contributor Zach Bristow 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 Virtus Health Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Warren Buffett is well known as one of the world’s all-time great investors. He made his fortune as a value-focused investor — someone who looks to buy stocks when they’re cheap and profit as they recover. As the recent market downtrend reminds us, that’s often easier said than done, as falling stocks tend to make it feel like your money is evaporating with every down day.

Still, if Buffett’s success shows us anything, it’s that a strong company that survives a down market can often come out the other side in a much better spot to deliver solid long-term returns for its shareholders.

With that in mind, we asked three successful investors to pick strong Warren Buffett stocks that are worth considering in today’s volatile market. They picked Coca-Cola (NYSE: KO), Visa (NYSE: V), and Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B). Read on to find out why and decide for yourself whether those companies deserve a spot in your portfolio.

Volatility goes better with Coke

Barbara Eisner Bayer — Coca-Cola (NYSE: KO): If anyone knows how to make money in all markets, including volatile ones, it’s Buffett, the famous nonagenarian who has an approximate net worth of $114 billion. And one of the Oracle of Omaha’s favorite stocks is his oldest stock position, which he started purchasing 34 years ago — The Coca-Cola Company.

Buffett is so in love with the company that he’s known to consume five cans of Coke each day. He even joked to Fortune magazine back in 2015 that his body is made up of “one-quarter Coca-Cola”. It’s no surprise, then, that Berkshire Hathaway owns about $22 billion worth of its shares, or 10% of the company.

It’s great that Buffett is so fond of Coke, but that in and of itself doesn’t make it a great buy for a volatile market. So let’s look at what does.

First, Coca-Cola’s products are consumed worldwide and embrace more than its fizzy namesake drink. Its portfolio of beverages has expanded to include changing and healthier tastes, and according to the company, includes “200 brands and thousands of beverages around the world from soft drinks and waters, to coffee and tea.” You’ve probably heard of many of them: Dasani, Fairlife, Fanta, Fuze Tea, Schweppes, Powerade, Smart Water, and Minute Maid. Because these drinks are worldwide staples, people aren’t going to stop drinking them when the stock market goes on a wild ride.

The company has survived extreme volatility in the past. Back in October 2018, during an extremely turbulent period, Coca-Cola was up 2% while the S&P 500 was down 9%. This happened because the company was, and continues to be, a huge, stable conglomerate with a solid dividend and continuing growth prospects.

While the company struggled during the coronavirus pandemic, it has finally returned to growth. During its recent fourth-quarter 2021 earnings report, Coca-Cola said net revenue had grown 10% year over year and earnings per share (EPS) were up 65% per share. And management sees brighter days ahead: 2022 revenue growth of 7.5% and EPS growth of 9% are numbers investors can get excited about for such a stable company.

But the cherry on top of these reasons why Coca-Cola is a great Buffett stock to own during volatile times is its dividend, which currently offers investors a 3% dividend yield. Coca-Cola is also a Dividend Aristocrat and has been raising its payout for 59 years in a row. If stocks start plummeting, investors will still be earning income from the dividend, which is vital when all you’re seeing is red every day in your portfolio.

If Buffett put down his bottle of Coke and spoke directly to you, he might just say that Coca-Cola — with its stable business, continuing growth prospects, and mighty fine dividend — may be the perfect stock to survive and even thrive through volatile times.

The power of plastic

Eric Volkman –Visa (NYSE: V): One of Buffett’s favorite sectors — if not the favorite — is finance. Witness Berkshire’s immense stakes in banks Wells Fargo and Bank of America, for example.

Among this crowd, one company that should continue to thrive no matter how wild global volatility becomes is one of Berkshire’s many finance industry holdings, Visa. The payment card processor has a brand that is ubiquitous throughout the world and a business model that continually produces oversize profits.

To understand why, we first have to make the distinction between open-loop card processors and their closed-loop peers. Visa and Mastercard fall into the former category, which essentially means they are payment network operators only, and not card issuers (i.e., the entities such as banks that actually extend the credit on a credit card, or draw funds from an existing account in the case of a debit card).

This contrasts with closed-loop card companies, most prominently American Express (a longtime Buffett favorite, by the way). These entities act as both the issuer and the network operator.

There are pluses and minuses to both business models, but I tend to favor the open-loopers. By sticking to facilitating transactions only, a company like Visa is basically a huge middle man, collecting a small piece of every purchase effected through its network. It assumes no credit risk while doing so; that’s for the issuer to worry about.

Like any effective middle man, Visa’s profitability is sustainably and consistently high (lately it’s boasted 50%-plus net margins).

And as the world keeps moving away from cash into plastic and digital means of payment, the company’s growth engine keeps humming. The card giant’s first quarter was typical of its recent performance — net revenue surged 24% higher year over year, to $7.1 billion, while non-GAAP (adjusted) net income enjoyed a 25% rocket ride to $3.9 billion.

No matter how jittery the world economy gets, people are always going to need to buy things. One of the most popular instruments in doing so, in this increasingly cashless environment we shop in, is a Visa card. This company is going to continue to thrive; you can bet on that.

Why not buy Buffett’s business?

Chuck Saletta — Berkshire Hathaway (NYSE: BRK.A): Imagine a company that was built from the ground up to be exactly the fortress-like investment that Warren Buffett likes to own. Now imagine that with one purchase, you can not only buy shares in a company like that but also hire Buffett and his hand-picked successors to manage it for you.

Believe it or not, you can do just that, with an investment in Berkshire Hathaway stock. Berkshire Hathaway is the insurance and investment conglomerate that Buffett runs. Between the strong insurance businesses, the wholly-owned subsidiaries, and the substantial stakes in solid public companies, it is built like a fortress to withstand tough times.

In addition to the great collection of businesses and world-class investment management team at the helm, you can buy your shares at a reasonable price. Berkshire Hathaway stock recently traded hands at less than nine times trailing earnings and only around 1 1/2 times its accounting book value. That means Buffett’s company can be purchased at a reasonable price, making it the sort of thing Buffett himself would be interested in owning.

Of course, even with a great business run by one of the greatest investors of all time, there are risks. In particular, Berkshire Hathaway trades at what looks like a cheap valuation in part because of something known as the conglomerate discount. In essence, large and diversified companies are viewed as less focused and nimble than smaller ones. As a result, the market doesn’t often put a rich valuation on companies structured like Berkshire Hathaway.

Still, that’s a small price to pay for a chance to own an incredibly strong company at a reasonable valuation in incredibly volatile times.

Great companies in troubled times

Regardless of whether Coca-Cola, Visa, or Berkshire Hathaway ever make their way into your portfolio, they are all certainly strong businesses that are built to survive a tough market and emerge stronger on the other side. That makes them worth considering as investments to help you navigate these volatile times. And with a stamp of approval from no less an investor than Warren Buffett, they certainly deserve every bit of that consideration.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post 3 strong Warren Buffett stocks for a volatile market appeared first on The Motley Fool Australia.

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Wells Fargo is an advertising partner of The Ascent, a Motley Fool company. American Express is an advertising partner of The Ascent, a Motley Fool company. Bank of America is an advertising partner of The Ascent, a Motley Fool company. Barbara Eisner Bayer owns Berkshire Hathaway (B shares). Chuck Saletta owns Wells Fargo and has the following options: long January 2024 $50 calls on Wells Fargo, short January 2024 $50 puts on Wells Fargo, short September 2022 $45 puts on Wells Fargo, and short September 2022 $55 calls on Wells Fargo. Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns and recommends Berkshire Hathaway (B shares), Mastercard, and Visa. The Motley Fool recommends the following options: long January 2023 $200 calls on Berkshire Hathaway (B shares), short January 2023 $200 puts on Berkshire Hathaway (B shares), and short January 2023 $265 calls on Berkshire Hathaway (B shares). The Motley Fool has a disclosure policy. The Motley Fool Australia has recommended Berkshire Hathaway (B shares) and Mastercard. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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The Global Lithium Resources Ltd (ASX: GL1) share price has come out of a trading halt on Monday. This comes after the emerging lithium company announced an update on its recent capital raise.

During early morning, Global Lithium shares reached an intraday and near record high of $1.825. This is slightly under the all-time high of $1.84 achieved on 20 January.

At the time of writing, Global Lithium shares have since retraced to $1.71, up 7.21%.

Global Lithium completes placement

Investors are buying up Global Lithium shares as the company seeks to progress its activities at Marble Bar and Manna Lithium Project.

According to its release, Global Lithium announced it has received firm commitments for a $29.9 million capital raising.

The company highlighted that it had strong support from global institutions as well as the introduction of cornerstone shareholder, Mineral Resources Limited (ASX: MIN). The latter is committing to invest $13.6 million for a 5% interest in Global Lithium after the capital raising is completed.

The placement will see approximately 22.18 million new ordinary shares issued at a price of $1.35 apiece. This represents a 10.8% discount to the 15-day volume-weighted average price (VWAP) before going into a trading halt.

The company will primarily use the proceeds to underpin the acceleration of its exploration programs and associated study work. This relates to the company’s Marble Bar Lithium Project (MBLP) in the Pilbara and the Manna Lithium Project (Manna) located 100 kilometres east of the Goldfields.

Global Lithium non-executive chair, Warrick Hazeldine commented:

As Global Lithium continues to advance our growth strategy with a significant West Australian lithium portfolio in Tier-1 locations, we are delighted to welcome Mineral Resources as a cornerstone investor in this capital raising. Alongside Suzhou TA&A, who continues to maintain their 9.9% stake, the Board is very excited about the depth of knowledge and lithium industry experience within the Company and through its key stakeholders.

We look forward to developing a long-term working relationship with Mineral Resources given the company’s unrivalled track record in successfully bringing operations into production quickly, processing of hard rock lithium ores and downstream processing.

Global Lithium share price summary

Adding to today’s gains, Global Lithium shares have pushed 750% higher in the past 12 months. However, when looking at year-to-date, the company’s shares are hovering around upwards of 80%.

Based on valuation grounds, Global Lithium presides a market capitalisation of around $232.77 million, with 136.12 million shares outstanding.

The post Why is the Global Lithium (ASX:GL1) share price powering ahead by 7% today? appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras 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 Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) has started the week strongly. In afternoon trade, the benchmark index is up 1.2% to 7,147.8 points.

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

Nickel Mines Ltd (ASX: NIC)

The Nickel Mines share price is down 2% to $1.17. This morning Macquarie downgraded the nickel producer’s shares to a neutral rating and cut its price target down from $1.70 to $1.30. Its analysts expect higher coal prices to offset any benefits from rising nickel prices.

Paladin Energy Ltd (ASX: PDN)

The Paladin Energy share price is down 6% to 81.5 cents. This morning the uranium miner agreed to sell its historical mining information for the Agadez Project in Niger to Kopore Metals Limited (ASX: KMT). Outside this, sentiment has been low for uranium since Russia’s invasion of Ukraine.

Tassal Group Limited (ASX: TGR)

The Tassal share price is down almost 2% to $3.41. The catalyst for this decline has been the seafood company’s shares trading ex-dividend this morning for its interim dividend. Eligible shareholders can look forward to receiving Tassal’s 8 cents per share dividend later this month on 30 March.

Westgold Resources Ltd (ASX: WGX)

The Westgold share price has tumbled 13% to $2.12. Investors have been selling down this gold miner’s shares today following the successful completion of its $100 million institutional placement. Westgold raised the funds at a 13.9% discount of $2.44 per new share. These funds will be used to accelerate the company’s Murchison and Bryah growth strategy. Management advised that this strategy is focused on establishing a systematic pathway towards a +400,000 ounce per annum gold production rate from FY 2024.

The post Why Nickel Mines, Paladin Energy, Tassal, and Westgold shares are dropping appeared first on The Motley Fool Australia.

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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 Bruce Jackson.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

It’s a common myth that the people who do well in the stock market are investing geniuses with a knack for choosing the right companies. Sure, having that talent could yield great results for your portfolio. But if it’s not a skill you possess, fear not.

There’s another investment option you can fall back on that could be your ticket to growing serious long-term wealth. And if you’re not convinced, consider this: It’s such a viable investment that even billionaire Warren Buffett is a fan.

Invest in the broad market

Warren Buffett has famously said that for everyday investors, putting money into an S&P 500 index fund is a solid bet. Now to be clear, it’s not that Buffett himself needs to rely on index funds. Clearly, the man knows a thing or two about picking stocks, as evidenced by the billions of dollars he’s managed to accrue in his lifetime. And so for him, choosing individual companies makes more sense.

Rather, Buffett feels that S&P 500 index funds are a great choice for people who may not know that much about vetting stocks, or who don’t want to take on the risk of putting their money into the wrong companies. And that’s why it pays to consider loading up on them.

If you’re not familiar with index funds, they’re passively managed funds whose goal is to match the performance of the benchmarks they’re tied to. If you buy shares of an S&P 500 index fund, you’ll effectively own a piece of 500 different companies.

That’s a good thing, because it lends to diversification in your portfolio. And a diverse portfolio can help you minimize losses during periods of market turbulence and grow long-term wealth.

Just how much wealth are we talking? Since 1957, the S&P 500 has delivered an average yearly return of around 10.5%. This isn’t to say that the index has done well every year since 1957. (Remember the Great Recession?) Rather, that 10.5% returns accounts for both strong years and weak ones.

Now, if you put $250 a month into an S&P 500 index fund over the next 40 years, you might enjoy that same return. And if so, you’ll end up with a portfolio worth $1.5 million. That’s not too shabby — especially if you consider yourself someone who doesn’t know all that much about picking stocks.

Learn from one of the greats

Warren Buffett has proven that he’s more than capable of beating the market. But that doesn’t mean that the average investor is equipped to do the same. That’s why he recommends putting money into an S&P 500 index fund. And if you follow his advice, there’s a good chance you’ll end up pleased with the outcome.

Of course, if you’re confident in your ability to assemble a portfolio of stocks that can outperform the broad market, go for it. But if you’d rather play it a bit safer, then it definitely wouldn’t hurt to listen to the words of someone who clearly has a knack for growing wealth. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Could this Warren Buffett recommendation be your ticket to a million-dollar portfolio? appeared first on The Motley Fool Australia.

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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 Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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The S&P/ASX 200 Index (ASX: XJO) is enjoying a very healthy start to the week so far this Monday. At the time of writing, the ASX 200 is up a pleasing 1.02% at over 7,100 points. So it might come as a surprise to see that the BHP Group Ltd (ASX: BHP) share price is firmly in the red today.

Yes, BHP shares are currently down by 0.4% at $47.50 each. Since the BHP share price makes up more than 10% of the ASX 200 these days, this is quite the divergence indeed.

Well, we can always point to the price of iron ore itself, BHP’s largest commodity base by far. As my Fool colleague James covered this morning, iron ore endured a slight pullback last Friday night, dropping 1.2% to US$154.50 a tonne. That saw the BHP share price fall on Friday’s trading. And this seems to be repeating today thus far.

Is the BHP share price missing out on oil’s gains?

But perhaps investors are also being pessimistic about another facet of BHP’s business: crude oil. BHP is currently a notable oil and liquified natural gas (LNG) producer. But it won’t be for long. Last year, the company agreed to offload its oil business to ASX 200 energy company Woodside Petroleum Limited (ASX: WPL). But that was inked when oil was well under US$90 a barrel. More recently, we’ve seen crude jump as high as US$130 a barrel. Today, Brent crude remains above US$110 a barrel, which is still a very high price by historical standards.

But it’s a boom that Woodside might benefit more from over the rest of the year, rather than BHP shares. The demerger of BHP’s oil assets is scheduled to be completed by the second quarter of this year. If oil remains anything close to the levels it is sitting at today for the rest of the year, it will be Woodside’s gain and BHP’s loss. 

In comments given to The Australian today, Woodside CEO Meg O’Neill said that the company is looking forward to helping fill the gaps that global sanctions against Russia have helped create in the Asian energy market. She named Japan as a key goal, saying that the world’s third-largest economy will be “leaning more towards countries like Australia” for their future energy needs.

But perhaps BHP shareholders don’t have too much to complain about as it currently stands. The BHP share price is now up more than 33% since November last year.

At the current BHP share price, this ASX 200 miner has a market capitalisation of $241.4 billion, with a dividend yield of 10.1%. 

The post The ASX 200 is up, so why is the BHP (ASX:BHP) share price falling today? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen 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 Bruce Jackson.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week on a positive note. At the time of writing, the benchmark index is up 1% to 7,134.5 points.

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

CSL Limited (ASX: CSL)

The CSL share price is up 2% to $261.79. Investors have been buying this biotherapeutics company’s shares following the release of an upbeat broker note out of Citi. Its analysts believe that industry data is pointing to plasma collections going beyond pre-pandemic levels in 2022. Its analysts expect this to boost sentiment and potentially drive its shares higher.

Dicker Data Ltd (ASX: DDR)

The Dicker Data share price is up 4% to $13.89. This follows the release of a broker note out of Morgan Stanley this morning. Its analysts have initiated coverage on Dicker Data with an overweight rating and $16.00 price target. The broker believes Dicker Data is well-placed for growth over the medium term thanks to industry tailwinds and its leadership position.

Elders Ltd (ASX: ELD)

The Elders share price is up 13% to $13.54. This morning the agribusiness company released a trading update which revealed that trading conditions have been strong during the first half. As a result, management advised that it is expecting its underlying earnings before interest and tax (EBIT) to increase by 20% to 30% in FY 2022.

Virtus Health Ltd (ASX: VRT)

The Virtus Health share price is up 7% to $8.23. Investors have been buying the fertility treatment company’s shares after it signed a binding transaction implementation deed with CapVest. This deal will see CapVest acquire Virtus for $8.25 cash per share less dividends. The Virtus board unanimously recommends the transaction in the absence of a superior proposal.

The post Why CSL, Dicker Data, Elders, and Virtus Health shares are charging higher appeared first on The Motley Fool Australia.

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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. owns and has recommended CSL Ltd. and Dicker Data Limited. The Motley Fool Australia owns and has recommended Dicker Data Limited. The Motley Fool Australia has recommended Elders Limited and Virtus Health Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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