If you’re looking to invest $3,000 into the ASX right now, I believe that the 3 ASX shares listed below are all quality options.

All 3 have very different business models and operate in 3 very different industries. However, I believe that all are well placed to outperform the S&P/ASX 200 Index (ASX: XJO) over the next 5–10 years.

Blackmores Limited (ASX: BKL)

Blackmores recent financial performance has been disappointing, with the company’s operations in China in particular underperforming. This underperformance has been reflected in the Blackmores share price, which has struggled to rise higher over the past year.

However, Blackmores has seen a rise in demand for its immunity products during the coronavirus pandemic. It also plans to further accelerate its Asian expansion strategy, particularly in China. I remain optimistic about the potential of Blackmores’ Asian strategy, and I am particularly encouraged by the potential that the Indian market holds for the company.

With the Blackmores share price well down on its 12-month high in early February, I believe now could be a good time to purchase shares at a more favourable price.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) 

I am attracted to Soul Patts as an ASX share to invest due to its strong market diversification. Soul Patts has market exposure to a broad range of industries, including pharmacies, telecommunications and mining and building products. This diversification acts as a buffer to any market volatility.

In addition, Soul Patts has an enviable long-term track record of outperforming the S&P/ASX 200 Index (ASX: XJO).

Soul Patts also has an excellent management team and a very conservative balance sheet. This places it in an ideal position to snap up any investment opportunities that may come its way. I believe this growth story is set to continue for Soul Patts in the next few years ahead.

Soul Patts is also a strong dividend paying share. It currently pays a fully forward dividend yield of 3.0%.

Audinate Group Ltd (ASX: AD8)

ASX tech share Audinate specialises in audio networking solutions that are used in the production of a range of professional audio equipment. Its core solutions work by improving audio quality using ethernet or fibre optic cables. This thereby reduces the need for extra cabling and installation.

For the six months ended 31 December 2019, Audinate delivered a solid 14% increase in revenue to $16.1 million. It also saw a very strong 3.8% increase in its gross margin to 77.1%. Its earnings before interest, tax, depreciation and amortisation climbed 11% to $1.9 million. Also, unaudited revenue for its most recent quarter climbed by 14%.

I believe the growth story for Audinate is set to continue over the next few years. Its core solution currently dominates the audio market, providing a strong competitive barrier to new market competition.

More reading

• Leading brokers name 3 ASX 200 shares to sell today
• Where to invest $1,000 in ASX tech shares today
• Why these ASX tech shares should be on your radar
• 2 exotic ETFs for your ASX portfolio
• Why the CBA share price and other ASX banks could outperform in FY21

Phil Harpur owns shares of Blackmores Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AUDINATEGL FPO. The Motley Fool Australia owns shares of and has recommended Blackmores Limited. The Motley Fool Australia has recommended AUDINATEGL FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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Exchange-traded funds (ETFs) are no longer a one-size-fits-all investment vehicle. The first ETFs available in Australia were plain old index funds — tracking benchmarks like the S&P/ASX 200 Index (ASX: XJO ) without too much fanfare.

But these days (much like the app store), if there’s a trend, asset class or industry to track, chances are there’s an ETF for that.

But with a plethora of choice out there, which ETFs should we choose for our portfolios? Well, if you’re looking to add some international exposure to your portfolio, I’ve found 2 exotic ETFs I think merit consideration.

iShares MSCI EAFE ETF (ASX: IVE)

Don’t let this acronym-replete name dissuade you. IVE tracks a basket of shares from Europe, Australia and the Far East (EAFE). Most of the international investing that Aussies tend to participate in revolves around the United States. While this is not necessarily a bad thing, I do think that America has its own set of unique challenges right now. Considering this, a bit of international diversification might not go astray in our portfolios.

IVE has its largest exposure (26% of the portfolio) to Japan with shares like Toyota. But the United Kingdom (at 14%), France (at 10.5%), Switzerland (10.2%) and Germany (9%) also feature heavily. Our own ASX shares make up around 6.4% of this ETF. Apart from Toyota, other companies that feature in IVE’s top 10 list include Nestle, Roche, Novartis, SAP and LVMH.

IVE has a management fee of 0.31% per annum, which I think is reasonable considering the geographical diversification it brings to the table.

ETFS Morningstar Global Technology ETF (ASX: TECH)

This tech-focused ETF (hence the ticker symbol) is one of my favourite exotic ETFs on the ASX. It aims to track a basket of tech-related companies that are selected by the reputable Morningstar group. It’s dominated by US companies (with 85.5% of the portfolio), but also features Japan, Germany and France in its exposures. TECH’s holdings are made up of both large and small tech companies. Microsoft is in the top 10, as is Fortinet, Splunk, ServiceNow and Intel.

Morningstar regularly updates and rebalances this index. Thus, you can have reasonable confidence that any company that stumbles or goes off the rails will be replaced with another up-and-comer. If you feel your portfolio doesn’t have sufficient exposure to the global technology sector, then TECH is a great way to easily remedy this situation. This ETF has a management fee of 0.45% per annum, which isn’t on the cheap side. However, since TECH has returned an average of 25.15% per annum over the past 3 years, personally I would consider this fee ‘worth it’.

More reading

• Why the CBA share price and other ASX banks could outperform in FY21
• Why CSL and these ASX 200 shares could be fantastic buy and hold options
• ASX 200 up 0.1%: Afterpay announces capital raising, big four banks lower ahead of RBA meeting
• Up 500%: Allegra Orthopaedics share price goes sky high following acquisition of patents
• 5 things to watch on the ASX 200 on Tuesday

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ETFS Morningstar Global Technology ETF. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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Buying ASX bank stocks may be less risky as you’d think as they aren’t about to fall off the fiscal cliff, according to one leading broker.

The fiscal cliff is the withdrawal of support measures offered during the COVID-19 pandemic come September. These include the government’s wage supplements as well as rent and loan repayment holidays.

Fears that consumers and businesses won’t be able to repay debts have weighed heavily on the banking sector, which is lagging the broader S&P/ASX 200 Index (Index:^AXJO).

Can CBA and other ASX banks outperform?

But there’s a chance for the Commonwealth Bank of Australia (ASX: CBA) share price, Westpac Banking Corp (ASX: WBC) share price, Australia and New Zealand Banking Group (ASX: ANZ) share price and National Australia Bank Ltd. (ASX: NAB) share price to play catch-up in FY21.

This fiscal cliff may turn out to be more of the molehill variety than a mountain, if Citigroup’s prediction is on the money.

Dividend revival for ASX banks

The broker drew on lessons learnt in New Zealand and is not only predicting that ASX banks will survive the fiscal cliff but will be in a better position to pay dividends in the near-term.

“With more severe stage 4 restrictions in place and nonessential life shuttered through April, the Kiwis took great sacrifice, but have emerged from all restrictions much faster than other countries,” said Citi.

This makes the NZ market an ideal place to study the impact of lockdowns its banking sector, particularly as NZ and Australia have so much in common.

Extending stimulus is key

The NZ experience shows that the Morrison government will need to keep supplementing wages even after the JobKeeper and JobSeeker programs expire in September. This is especially so if consumer spending is to make a V-shape recovery.

Mark your calendar for July 23 fellow Fools. That’s when the federal government will provide an update on this and other stimulus measures – and I’m keeping my fingers tightly crossed.

However, business confidence will take more time to repair although Citi thinks the disconnect is a matter of timing and not something more sinister.

ASX banks and the fiscal cliff

This isn’t to say there won’t be long lasting impacts from the coronavirus meltdown. Going forward, businesses will need to find new ways to cut costs as their operations will likely be stuck on a lower gear for longer.

“Like Australia, the focus in NZ is on the ‘fiscal cliff’ when the wage subsidy end,” added Citi.

“However, our takeaway this week is that while the cliff marks the end of ‘liquidity injection’, there remains a substantial excess of liquidity to draw down on and to cushion bad debts.”

Foolish takeaway

If our big banks do not need to make additional provisioning for bad debt, the sector will re-rate strongly.

This is particularly the case if the banks feel confident enough to restore some of their dividend cuts later this year.

More reading

• 2 exotic ETFs for your ASX portfolio
• Why CSL and these ASX 200 shares could be fantastic buy and hold options
• ASX 200 up 0.1%: Afterpay announces capital raising, big four banks lower ahead of RBA meeting
• Up 500%: Allegra Orthopaedics share price goes sky high following acquisition of patents
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor Brendon Lau owns shares of Australia & New Zealand Banking Group Limited, Commonwealth Bank of Australia, National Australia Bank Limited, and Westpac Banking. Connect with me on Twitter @brenlau.

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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What happened?

The Australian Ethical Investment Ltd (ASX: AEF) share price has surged by more than 5% today. The fund manager updated its earnings guidance after better than expected returns in its Emerging Companies Fund has resulted in a performance fee.

Australian Ethical Investment advised that its Emerging Companies Fund returned almost 14%, after fees, for wholesale investors (investments over $25,000). This is compared to its benchmark index, S&P ASX Small Industrials, which returned negative 7.4%

As a result, a performance fee of $3.64 million, calculated as 20% of the fund’s one-year outperformance over its benchmark, was earned by Australian Ethical Investment. The performance fee and a proportionate increase in the contribution to the Australian Ethical Foundation adds to the expected underlying profit before tax (UPAT) that was announced on 22 June 2020.

The revised UPAT for FY2020 is now expected to be between $9 million and $9.5 million, which is an increase of over 40% from FY2019.

What does Australian Ethical Investment do?

Australian Ethical Investment provides investors an opportunity to invest in products that align with their values and provide competitive returns. Its investments are guided by the Australian Ethical Charter and  it structures its investing on three pillars, which are caring for the planet, people and animals.

Australian Ethical Investment currently has $3.92 billion in funds under management as of 31 May 2020 and a market cap sitting over $700 million.

The Australian Ethical share price has had a storming run from its $2 lows in mid-March up to its all-time highs of $9 in mid-June. The share price has since dropped away, but it is still up over 200% on its lows this year and currently sits at $6.68 per share.

More reading

• Why Australian Ethical, Magellan, St Barbara, & Sezzle shares are zooming higher
• Australia could be moving towards zero emissions, these are the green companies to buy
• Fund managers have been buying these ASX shares
• Why Altium, Australian Ethical, Flight Centre, & Transurban are dropping lower
• 2 high quality ASX shares to buy if the COVID-19 selloff gets worse

Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Australian Ethical Investment Ltd. The Motley Fool Australia has recommended Australian Ethical Investment Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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One of the simplest investment strategies that investors can use is the buy and hold strategy.

The idea behind the strategy is simply that investors buy high quality shares that have solid long term growth prospects and hold onto them for long periods of time.

Three quality shares that I think would be great options for buy and hold investors are as follows:

Appen Ltd (ASX: APX)

When looking for buy and hold options, I think it is important to find an industry that has strong growth potential. After which, I will then look for a company that has a leading position within it. With that in mind, I think Appen is a prime example of a great buy and hold option. It is the global leader in the development of high-quality, human annotated datasets for an artificial intelligence market forecast to grow materially over the next decade.

CSL Limited (ASX: CSL)

Another of my favourite buy and hold options is this global biotherapeutics giant. Thanks largely to the quality of its products and its high level of investment in research and development, the CSL share price has generated outsized returns for its shareholders for well over a decade. I remain confident that the company is well-positioned to carry on this strong form over the 2020s. As a result, I think it could be a fantastic addition to most portfolios.

Xero Limited (ASX: XRO)

A final buy and hold option to consider is Xero. It is a cloud-based business and accounting software provider which has been growing at an exceptionally strong rate over the last few years. Pleasingly, this continued to be the case in FY 2020, with Xero reporting very strong recurring revenue growth. This strong growth was driven by a combination of increased subscriber numbers, low churn levels, and higher average revenue per user. Looking ahead, due to its global growth opportunities and the quality and stickiness of its product, I expect more of the same in the years to come.

More reading

• 2 exotic ETFs for your ASX portfolio
• Why the CBA share price and other ASX banks could outperform in FY21
• ASX 200 up 0.1%: Afterpay announces capital raising, big four banks lower ahead of RBA meeting
• Up 500%: Allegra Orthopaedics share price goes sky high following acquisition of patents
• 3 of the best ASX tech shares to buy in July

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. and Xero. The Motley Fool Australia owns shares of Appen Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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At lunch on Tuesday the S&P/ASX 200 Index (ASX: XJO) has given back the majority of its strong morning gains but remains just in the black. The benchmark index is currently up 0.1% to 6,021.1 points.

Here’s what has been happening on the ASX 200 today:

Afterpay capital raising and update.

The Afterpay Ltd (ASX: APT) share price is in a trading halt on Tuesday as its seeks to raise $800 million from investors. This comprises a $650 million fully underwritten placement to institutional investors and a $150 million share purchase plan. The payments company is aiming to raise the funds at $61.75 per new share. This represents a 9.2% discount to its last close price. Afterpay also released a trading update and revealed that its underlying sales came in at $11.1 billion in FY 2020. This is up 112% on the prior corresponding period.

Banks lower ahead of Reserve Bank meeting.

Commonwealth Bank of Australia (ASX: CBA) and the rest of the big four banks are all trading lower ahead of the Reserve Bank’s monetary policy meeting this afternoon. Investors appear nervous that the central bank will take the cash rate to zero and add further pressure to bank margins. At present, cash rate futures indicate a 62% probability of a rate cut today.

St Barbara update impresses.

The St Barbara Ltd (ASX: SBM) share price is storming higher after the release of its fourth quarter production update. According to the release, fourth quarter gold production came in at 108,612 ounces. This lifted the gold miner’s full year production to 381,887 ounces, which was in line with its full year production guidance of 370,000 to 400,000 ounces. At the end of the period, St Barbara had A$406 million in cash and term deposits.

Best and worst ASX 200 shares.

The St Barbara share price is the best performer on the ASX 200 on Tuesday with a sizeable 8% gain. This follows the release of its aforementioned production update. The worst performer on the index has been the Mesoblast limited (ASX: MSB) share price with a 4% decline. This appears to be down to profit taking after strong gains on Monday following a positive update.

More reading

• 2 exotic ETFs for your ASX portfolio
• Why the CBA share price and other ASX banks could outperform in FY21
• Why CSL and these ASX 200 shares could be fantastic buy and hold options
• Why Australian Ethical, Magellan, St Barbara, & Sezzle shares are zooming higher
• St Barbara share price lifts 6% on record quarterly production

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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 A2B Australia Ltd (ASX: A2B) share price jumped by over 5% yesterday following the release of a market update. A2B, formerly known as Cabcharge Australia Limited, is the market leader in the personal transport sector. The company manages fleets of taxis and premium taxi services, as well as payment processing, taxi bookings systems and EFTPOS consulting services.

What did A2B announce?

A2B updated the market on its performance during the COVID-19 pandemic. In particular, the company advised that, after an 80% decline in payment turnover during the early weeks of the pandemic, it had enjoyed 10 consecutive weeks of growth. 

The cab operator also announced that changing customer behaviour during the pandemic, as well as an increased desire for contactless payment technologies, is fueling a period of rapid geographic expansion. During FY20, A2B subsidiary Mobile Technology International has installed its bookings and despatch technology for clients across Canada, the United States, Finland and Denmark. 

Within Australia, another subsidiary company, 13Cabs, has also grown significantly during FY20. 13Cabs has initiated service arrangements for a number of local taxi networks across regional locations such as Taree, Dubbo and Townsville. In response to demand from local operators, 13Cabs has also launched proprietary networks in Perth, Albury/Wodonga, Toowoomba, Darwin and Wollongong.

Even with this expansion, the company’s active fleet numbers are still 23% lower than pre-pandemic levels but are recovering.

Financial position

I believe A2B’s robust balance sheet at the outset of the pandemic, as well as its early and decisive action, have positioned the company well for continued recovery. After payment of the H1 FY20 dividend, A2B has a total liquidity position of ~$74 million. This includes $24.2 million of free cash

Social distancing and COVID-19 control measures continue to impact economic activity. However, the company’s brand strength and technologies have enabled it to increase its footprint during the pandemic.

A2B share price

The A2B share price closed at $0.82 on Monday, valuing the company at $98.75 million. This gives it a price to earnings ratio of 10.04 and a trailing 12 month dividend yield of 9.76%.

More reading

• 2 exotic ETFs for your ASX portfolio
• Why the CBA share price and other ASX banks could outperform in FY21
• Australian Ethical Investment share price surges 5% on updated earning guidance
• Why CSL and these ASX 200 shares could be fantastic buy and hold options
• ASX 200 up 0.1%: Afterpay announces capital raising, big four banks lower ahead of RBA meeting

Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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