The S&P/ASX 200 Index (ASX: XJO) fell by just over 1.5% today with Melbourne entering into a lockdown again today.

Australia’s second largest city faces a lockdown of six weeks to halt the spread of COVID-19 in Victoria.

Northern Star Resources Ltd (ASX: NST) impresses the market

The top performer within the ASX 200 today was Northern Star, its share price rose by 6.5% after delivering its June 2020 update.

Within the update the gold miner said that its cash, bullion and investments rose by 40% to A$769.5 million at 30 June 2020 compared to A$551.4 at 31 March 2020. This meant the company finished with a net cash position. It had corporate bank debt of $700 million at 30 June 2020. It repaid $200 million of that debt on 6 July 2020.

Northern Star stated that it generated underlying free cashflow of $217.9 million in the three months to June 2020 after selling 262,717 ounces of gold. This took the total sales for the 2020 financial year to 900,388 ounces, while gold produced totalled 905,177 ounces. This was 1.6% lower than the low end of the FY20 guidance.

In light of the “solid result”, Northern Star said it will pay its FY20 fully franked interim dividend of 7.5 cents per share on 16 July 2020. The payment of this dividend, which totals A$55 million, was postponed when the ASX 200 gold miner withdrew its FY20 guidance a few months ago.

The company expects to resume dividend payments in the ordinary course of business.

Afterpay Ltd (ASX: APT) completes its $650 million institutional capital raising

The buy now, pay later business said that it had successfully raised the target amount of $650 million from institutional investors. The placement was priced at $66 per share.

Afterpay said the capital raising was strongly supported by existing and new shareholders. Co-founders Anthony Eisen and Nicholas Molnar managed to each sell 2.05 million shares at the placement price of $66 per share. They have committed not to sell any other shares until after the 2020 annual general meeting (AGM).

Afterpay director Elana Rubin said: “The market has responded strongly to our aspiration to further accelerate our investment in growing underlying sales and expanding our global footprint, with the placement being oversubscribed. We are very pleased with the support we have received from our existing shareholders and we welcome our new investors to the register.”

Regular retail investors will soon be able to buy up to $20,000 worth of the ASX 200 share at the lower price of $66 and the 5-day value weighted average price of Afterpay shares up to the share purchase plan (SPP) closing date.

Splitit Ltd (ASX: SPT) share price jumps 8%

The rapidly-rising buy now, pay later business released its quarterly update today.

Splitit’s merchant sales volume grew 260% to US$65.4 million in the three months to 30 June 2020 compared to the prior corresponding period. This was a 176% increase on the previous quarter.

The company’s non-GAAP revenue rose 460% to US$2.4 million for the quarter, it represented a 246% rise on the first quarter of 2020.

Total merchants rose 104% over the past 12 months to 1,000 merchants. Total unique shoppers jumped 85% to 309,000.

Splitit’s average order value increased by 44% (compared to the prior corresponding period) to US$893.

Some of the large new merchants that are now live and signed include Purple, Daily Sale, Quiet Kat, Dreamcloud, Bedmart, Scorptec, Tatami Fightwear, Sofa Club and Alpina Watches.

New Splitit partnerships have been made with Mastercard, Finance for Group and Blue Snap.

More reading

• Why the Splitit share price soared 140% in June
• Why it’s time to rotate out of JB Hi-Fi share price and these popular ASX stocks: Macquarie
• 2 reasons early super withdrawal might be a bad idea
• Top brokers are urging investors to buy these ASX stocks today
• My bull and bear case for the ASX share market

Motley Fool contributor Tristan Harrison 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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ASX shares are a great way to start building your wealth, even if you only have $500.

It can be hard to know where to start. ASX shares have proven to be long-term performers. Generally, shares have returned around 10% per annum over the long-term. The returns look even better when you add in the bonus of franking credits which boost the after-tax return of dividends.

Now you know that shares have broadly performed well. But what are you supposed to invest in? There are thousands of different investment options on the ASX.

To help get you started, I have two ASX share ideas for you:

Share 1: Future Generation Investment Company Ltd (ASX: FGX) 

I think diversification is important for beginner investors. For example, if you put your $500 into Commonwealth Bank of Australia (ASX: CBA) shares then all of your money is tied up in one business. I think it could make a lot of sense to go for an initial investment that offers a lot of diversification upfront.

There is a certain group of businesses called ‘listed investment companies’ (LICs). Their job is to invest on behalf of shareholders. Future Generation is one of my favourite LICs for a number of reasons.

I like it because of the philanthropic nature of it. Future Generation donates 1% of its net assets each year to youth charities. This amounts to millions of dollars every year.

Future Generation doesn’t invest directly into ASX shares, instead it invests into the funds of fund managers who invest in ASX shares. These fund managers are meant to be the best in Australia and are chosen by the Future Generation investment committee. Those fund managers work for free so that the annual donation can be made. Each of those funds represents a diversified portfolio, so Future Generation is probably indirectly invested in dozens of different businesses. That’s good diversification.

Returns and dividend

A LIC should be judged for the returns that it generates. Since inception in September 2014 to May 2020, Future Generation’s investment portfolio delivered a gross return of 7.2% per annum. This outperformed the S&P/ASX All Ordinaries Accumulation Index’s return of 5.1% per annum. I think that’s a solid performance. 

Indeed, Future Generation outperformed the index over one month, six months, 12 months, three years and five years. It has done well during this COVID-19 period. 

LICs can turn the investment performance into a consistent dividend for shareholders. At the current Future Generation share price it offers a grossed-up dividend yield of 7.1%.

The ASX share is currently trading at a share price of $1, which is a 12% discount to the net tangible assets (NTA) at 31 May 2020.

Share 2: Betashares Global Sustainability Leaders ETF (ASX: ETHI) 

Another good option for beginner investors is an exchanged-traded fund (ETF). An ETF is a fund you can buy just like a share through an exchange, like the ASX.

There are lots of different types of ETFs. Some are based on countries like Australia or the US. Some ETFs are focused on specific industries like healthcare, gold or technology.

There are ETFs which are based on a particular theme, or have particular standards when it comes to quality or ‘ethics’. It can be hard to definite ethical investing because each person may prefer to exclude different things. For example, some people may want to exclude companies involved with poor environmental credentials whereas other people may want to leave out businesses involved with gambling.

Betashares Global Sustainability Leaders ETF excludes many different things like gambling, tobacco, alcohol, junk food, human rights and supply chain concerns. It has a particular focus on businesses that are climate leaders that try to be carbon efficient.

Its top share holdings as of yesterday were: Apple, Mastercard, Nvidia, Visa, Home Depot, Adobe, Paypal, Netflix and Toyota. Obviously none of these are ASX shares. So you’re getting good international diversification if you go with this ETF as your first investment pick.

Past performance is not a guarantee of future performance. But the returns of this ETF have been impressive and it shows that you don’t need to give up good performance to be invested in this ETF. Since inception in January 2017 it has returned 20.7% per annum after fees.

It’s pretty cheap for an ‘ethical’ investment pick – the annual cost is 0.59% per annum.

Foolish takeaway

I think both of these ASX shares would be good first investments. Indeed, I’d be happy enough to just invest in these two ideas and nothing else. Future Generation is good way to get ASX share exposure, plus it has a good dividend and it’s at good value. I think Betashares Global Sustainability Leaders ETF can provide strong international returns, like it has done, with its focus on sustainable businesses.

More reading

• 3 ASX dividend shares to grow and diversify your income
• 3 very reliable dividend shares I plan to pay for my retirement
• Do you have $1k to invest? Buy 1 of these ASX shares
• 2 ETFs for easy investing and good returns

Motley Fool contributor Tristan Harrison owns shares of FUTURE GEN FPO. 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.

The post Starting to invest with $500? Here are 2 ASX shares appeared first on Motley Fool Australia.

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