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Okay, we get it. Inflation is high so interest rates need to rise.

But after a whopping 125 basis point increase over the past couple of months, grocery bills surging, record-high petrol prices and a pummelling of our ASX shares, isn’t that enough pain?

Surely putting people through such financial stress can’t be good for the economy either?

AMP Ltd (ASX: AMP) chief economist Dr Shane Oliver explored this very dilemma this week.

“Many are still questioning why central banks need to do much – what will RBA rate hikes do to bring high lettuce prices back down?” he said on the AMP blog.

“And that central bank worries about wages growth picking up causing a wage-price spiral are just a baby boomer fantasy. So just sit it out.”

Authorities are scarred by the 1970s

The reason why central banks want to kill off inflation at any cost is because of the experience from the 1970s.

There were a bunch of reasons for inflation creeping up high that decade in Australia and the United States.

According to Oliver, the problem was exacerbated in Australia with wages growth of more than 20% and huge fiscal stimulus in 1974.

“The automatic indexation of wages to inflation from 1975 just helped lock in high inflation,” he said.

“The end result was a decade of high inflation and high unemployment.”

Unfortunately, central banks and governments did not help the situation.

“The problem was that policymakers were too slow to realise the extent of the inflation problem initially and then were too quick to ease which enabled inflation to quickly pick up again and move higher,” said Oliver.

“The longer inflation persisted the more inflation expectations rose – with wage growth rising – making it harder to get inflation back down.”

Will we go back to the future?

So how can 2022 turn into the 1970s?

Labour markets are once again very tight. In the US, wages growth has burst out to about 5%, while Australia’s unemployment rate is now at a 48-year-low of 3.5%.

The war in Ukraine has resulted in supply shocks for both food and energy, which have surged in price. In Australia, the east coast floods have added to the food inflation.

Recent geopolitics and the COVID-19 pandemic have changed the way nations and corporations conduct business.

“The globalisation that followed the end of the USSR and trade with China is under threat and appears to be reversing, not helped by a desire to onshore supply chains.”

Decarbonisation of economies are also boosting short-term capital spend and demand for certain metals.

Also, authorities are just coming out of a long period of low inflation.

“Policymakers were caught focussing on the last war of disinflation coming out of the pandemic just as they were in the 1960s when the big fear was a return to 1930s deflation,” said Oliver.

“This saw massive fiscal stimulus and money supply growth.”

Inflation leads to inflation expectations, which is dangerous

All these reasons are why central banks are so determined to blunt inflation, even if it means our ASX shares take a beating and economies might even fall into recession.

Inflation is running around 9% in the US and Europe, while in Australia it’s estimated to be about 6%.

“And, as we saw in the 1970s, the longer it remains high the more businesses and workers will expect it to remain high and they will plan accordingly,” said Oliver.

“That is, inflation expectations will move up, which will make it harder to get inflation back down.”

Central banks can’t bring down the cost of lettuce or unleaded fuel. But they’re correct in trying to do whatever they can to dampen demand, according to Oliver.

“They are right to have moved to a more aggressive strategy as it will slow demand and by stressing that they are committed to returning inflation to target will help keep inflation expectations down.”

Oliver is optimistic that the authorities will be successful and that the world will not slip into the awful stagflation spiral of the 1970s.

“Longer-term inflation expectations remain low (at 3.1% in the US compared to nearly 10% in 1980) and wages growth is still relatively low, suggesting it should be easier to bring inflation down than it was in 1980,” he said.

“While inflation may not go back to pre-pandemic lows and the longer-term tailwind for investment markets from ever lower inflation and interest rates may be behind us, a full-on return to the 1970s malaise looks unlikely.”

The post Why interest rates need to rise despite ASX carnage: economist appeared first on The Motley Fool Australia.

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More reading

• Why did the AMP share price fall 13% in FY22?
• What dragged the AMP share price down 13% in June?
• ASX bank shares look out, AMP has new tech under the hood
• Down 10% in a month, here’s the latest for the AMP share price
• Will Australia plunge into a recession?

Motley Fool contributor Tony Yoo 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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Rising inflation and interest rates have probably got you thinking about the potential impact on your wallet.

It’s certainly crossed my mind. So I spent time thinking about ways to stretch my family’s money further.

I’ll note that it was also important to me and my wife to have money left over for savings and/or investments.

So, here are some ways that I’m saving money.

Budget 

First and foremost, I got a budget going. 

I used a free budget template on Google Sheets which I found here. At the top right of the page, click “Template Gallery” and I chose the “Monthly Budget” option.

I got pretty precise with my estimates, using actual figures I came up with by analysing my bank statements from the past 12 months. In reality, however, using ‘reasonable estimates’ is a good starting point to seeing where your money goes each month.

You’ll probably be surprised at how much you’re spending on some items, which could be a perfect starting point to make savings!

Put away for big expense items 

I think this is a big one for most people. One month (or week, or fortnight – whatever your schedule for getting paid is) you seem to have plenty of spare cash to spend, and the next you’re back in the red. The culprit: a large land tax payment, a child’s birthday, or a car registration. Sometimes you can split these payments into more manageable bites, but others you can’t. When that’s the case, set cash aside regularly for these payments.

For example, if you expect your land rates bill to be $1,500 for the year, that’s $28.85 per week or $125 per month. Sure, it’s still a decent chunk of change, but either of those options are probably more bearable than a $1500 lump-sum payment.

So, list these big-ticket items in your budget. Add up the total annual amount due for those and chip away at them through the year. In effect, you’re smoothing out your expenses and setting yourself up for a better routine.

Choose annual payments

This mightn’t suit everyone, but where possible I’ve changed my subscriptions to the ‘annual’ payment option. 

Take Disney+ – a streaming service from Disney (NYSE: DIS) which my kids love – as an example. It’s currently $11.99 per month, or $119.99 for the year, which works out to be $10 per month – a saving of 16.6%. Then, in the months between, I’m putting away $10 per month into a separate account (just like I am for the land rates bill and water bills, etc.) to make sure I’ve got the money set aside for next year’s payment.

In doing so, though, it’s important to be careful not to create a cash-flow problem for yourself in the immediate future.

Find discounted alternatives

Human beings are typically a pretty routine species. We find something that works and often stick with it for simplicity. But that habit might be costing you. 

Here’s an example. To buy a 48-pack of nappies costs us $32 at Woolworths (ASX: WOW). I decided to check out prices on Amazon (NASDAQ: AMZN)’s store. Not only was it cheaper, I could get them even cheaper still by setting up a recurring purchase of that item. You won’t be able to do that for everything, but it’s worth a look for some of your more regular purchases.

Identify other habits

Speaking of habits, it could be worth looking into habits elsewhere in your life. Our grocery bill is typically pretty large. One way we can cut that back is changing what I have for lunch. I was regularly buying pre-made salads from Woolworths for simplicity at $6 a pop. It’s convenient, sure, but I can make something just as healthy (if not healthier) for less.

Invest in yourself

From the get-go, I figured out what my family’s monthly income was expected to be. After I accounted for the absolute top-priority payments (e.g. any debt repayments), I calculated what 10% of that total income would be and committed that to savings and/or investments.

This takes discipline and it could well require you to cut out some other expenditures that you deem to be less necessary. 

But this is an important step. After all, very few of us want to work forever. Saving money effectively buys you flexibility with your time – maybe not today, but in the future.

Interest rates are going up, which means any cash saved could earn a higher return. Perhaps even more opportunistic is the fact that the stock market has also come down, affording those people with a long-term time horizon an opportunity to buy shares at very attractive prices. 

If you can commit to setting aside a certain amount of money each week, fortnight, or month, doing so could be an excellent way to reward the future you.

The post Here’s how I’m saving money, despite higher inflation & interest rates appeared first on The Motley Fool Australia.

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More reading

• Why interest rates need to rise despite ASX carnage: economist
• 5 things to watch on the ASX 200 on Friday
• Analysts name 2 ASX dividend shares to buy with 5%+ yields
• Sayona shares sail 8% ahead amid government’s call to secure energy supply
• Why might ASX-listed ANZ want to snap up MYOB?

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Ryan Newman 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 Alphabet (A shares), Alphabet (C shares), Amazon, and Walt Disney. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2024 $145 calls on Walt Disney and short January 2024 $155 calls on Walt Disney. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, and Walt Disney. 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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On Thursday, the S&P/ASX 200 Index (ASX: XJO) was on form and charged higher. The benchmark index rose 0.45% to 6,650.6 points.

Will the market be able to build on this on Friday and end the week on a high? Here are five things to watch:

ASX 200 expected to fall

The Australian share market looks set to end the week in the red following a poor night of trade on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open 53 points or 0.8% lower this morning. In the United States, the Dow Jones fell 0.45%, the S&P 500 dropped 0.3%, and the Nasdaq traded flat.

Oil prices edge higher

Energy producers including Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a decent finish to the week after oil prices edged higher. According to Bloomberg, the WTI crude oil price is up 0.15% to US$96.44 a barrel and the Brent crude oil price is up 0.25% to US$99.81 a barrel. Supply concerns boosted prices.

Rio Tinto’s quarterly update

The Rio Tinto Limited (ASX: RIO) share price will be on watch this morning when the mining giant releases its second quarter and first half production update. According to a note out of Goldman Sachs, its analysts expect quarterly iron ore shipments of 78.7 Mt and the consensus estimate is for 79.3Mt. The market will also be listening out for commentary on cost inflation.

Gold price drops

Gold miners Newcrest Mining Ltd (ASX: NCM) and St Barbara Ltd (ASX: SBM) could have a tough finish to the week after the gold price dropped overnight. According to CNBC, the spot gold price is down 1.6% to US$1,708.20 an ounce. Growing US Fed rate hike bets weighed on the safe haven asset.

AVZ shares poised to return

AVZ Minerals Ltd (ASX: AVZ) shares are poised to return from their lengthy suspension on Friday morning. This embattled lithium developer is currently fighting legal action from a Chinese company that claims it owns a stake in the Manono Lithium project. If things don’t go the company’s way, there are fears that AVZ could end up owning as little as 36% of the project.

The post 5 things to watch on the ASX 200 on Friday appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX shares today
• Why did the Pointsbet share price leap 7% on Thursday?
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Own Rio Tinto shares? The company’s leaning into demand for this high-value metal
• These ASX 200 mining shares are bolstering the market 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 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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Are you looking for dividend shares to add to your income portfolio? If you are, then the two listed below could be worth considering.

Not only have these dividend shares been rated as buys, but they have also been tipped to provide investors with attractive yields.

Here’s what you need to know about them:

Australia and New Zealand Banking Group (ASX: ANZ)

The first dividend share for investors to look at is ANZ. It could be a good option for investors that don’t already have exposure to the banking sector. Particularly given recent volatility, which has dragged the ANZ share price lower. This means its shares are currently trading far closer to their 52-week lows than their 52-week highs.

One broker that appears to see this as a buying opportunity is Citi. It currently has a buy rating and lofty $30.75 price target on the bank’s shares.

Its analysts are also expecting some big dividend yields from ANZ’s shares in the coming years following the aforementioned decline. It has has pencilled in fully franked dividends per share of 147 cents in FY 2022 and then 170 cents in FY 2023. Based on the current ANZ share price of $21.93, this implies yields of 6.7% and 7.75%, respectively.

Centuria Industrial REIT (ASX: CIP)

Another ASX dividend share that has been rated as a buy is industrial REIT, Centuria Industrial.

It could be a top option for investors thanks to the robust demand for industrial properties. In fact, demand has been so strong that during the first half Centuria Industrial reported an ~9-year weighted average lease expiry with a 99.2% portfolio occupancy. This underpinned strong funds from operation (FFO) and allowed management to upgrade its guidance.

Macquarie remains very positive on Centuria Industrial. Last month it put an outperform rating and $3.94 price target on its shares. This suggests major upside potential for the company’s shares over the next 12 months.

As for dividends, the broker is forecasting dividends per share of 17.3 cents in FY 2022 and 16.8 cents FY 2023. Based on the current Centuria Industrial share price of $2.93, this equates to yields of 5.9% and 5.7%, respectively.

The post Analysts name 2 ASX dividend shares to buy with 5%+ yields appeared first on The Motley Fool Australia.

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More reading

• Why might ASX-listed ANZ want to snap up MYOB?
• Surprise US inflation pumps the brakes on ASX 200 bank shares
• What’s the outlook in FY23 for ASX 200 bank shares?
• ASX 200 midday update: ANZ confirms MYOB talks, energy shares fall
• ANZ share price drops amid MYOB takeover talks

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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The Sayona Mining Ltd (ASX: SYA) share price finished well in the green today.

Sayona shares closed at 14 cents today, a 7.69% gain. For perspective, the S&P/ASX 200 Index (ASX: XJO) climbed 0.44%.

Let’s take a look at what’s been happening with Sayona shares.

Sayona shares on the rise

Sayona shares soared today but they were not the only ASX lithium shares to jump. Pilbara Minerals Ltd (ASX: PLS) shares leapt 3.81%, the Core Lithium Ltd (ASX: CXO) share price rose 2.86%, and the Allkem Ltd (ASX: AKE) share price climbed 2.7%. Further, the S&P/ASX 200 Materials Index (ASX: XMJ) closed 1.56% higher.

Sayona is a lithium producer exploring projects in Western Australia and Quebec, Canada.

The company has recently revealed plans to restart lithium production at the North American Lithium Operation.

Sayona, along with Piedmont Lithium Inc (ASX: PLL), has agreed to speed up production at the project. The first spodumene concentrate production is earmarked for the first quarter of 2023. The Sayona share price soared on the back of the news late last month,

Meanwhile, the government is calling for more secure clean energy supply chains as the world moves towards net zero, the Australian Financial Review reported. In a speech to a global energy forum in Sydney this week, Prime Minister Anthony Albanese said:

It is essential that the unprecedented levels of investment in clean energy technologies required over the coming decades unlocks more diverse and secure supply chains than we have today.

Greater diversity and security of critical minerals extraction and processing, greater diversity of clean technology manufacturing, and security of clean energy supply are essential for managing supply and strategic risks.

Meanwhile, in quotes cited by the Sydney Morning Herald, US energy secretary Jennifer Granholm raised concerns China is “big-footing” energy supply chains. She said:

From an energy security point of view, it is imperative that nations that share the same values to develop our own supply chains, not just for the climate, which of course is very important, but for our own energy security.

Share price snapshot

Sayona shares have soared 65% over the past 12 months and risen 7.69% year to date.

In the past week, the company’s share price has lost 6.67%.

For perspective, the S&P/ASX 200 Index (ASX: XJO) has fallen nearly 10% in the past year.

Sayona has a market capitalisation of about $1.2 billion based on today’s share price.

The post Sayona shares sail 8% ahead amid government’s call to secure energy supply appeared first on The Motley Fool Australia.

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More reading

• Why is the Sayona Mining share price tumbling 6% today?
• How did the Sayona Mining share price perform in FY22?
• Why did the Sayona Mining share price crash 32% in June?
• Why Regis Resources, Sayona, Woodside, and Xero shares are pushing higher
• Why BWX, Sayona Mining, Tyro, and Woodside shares are sinking

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 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 acquisition trail continues into the new financial year. Another publicly-listed company has its sights set on a private entity.

Australia and New Zealand Banking Group Ltd (ASX: ANZ) is understood to be in talks to acquire accounting software firm MYOB Group from its parent company.

At market close on Thursday, ANZ shares are down 2.23% to $21.93.

ANZ said to be acquiring MYOB

The banking giant confirmed it was in talks with MYOB’s parent, private equity juggernaut KKR & Co., to acquire the accounting software firm.

It’s understood the transaction could reach a settlement of $4.5 billion, according to Reuters.

If this were so, it would represent an incredible $2.9 billion gain on investment for KKR, who bought MYOB private back in 2019.

Still, ANZ has total assets of $2.4 billion in March, made up of $404 million in cash.

MYOB’s public competitor, Xero Limited (ASX: XRO) has an enterprise value of $12.83 billion after adjusting its market cap for cash and debt, valuing MYOB at 35% of this amount.

ANZ’s potential decision comes at a time when ASX banks have been freeing up capital to offset pressures bought on by the Reserve Bank (RBA)’s tightening policy.

Analysts at investment bank Jefferies were quick onto the update and said there wasn’t necessarily a need for ANZ to own an accounting platform seeing as it has plenty of internal, comparable software.

However, the rationale behind the investment is probably to gain more customer data in order to sell more business banking products, The Australian writes.

Despite the pair being in talks on the transaction, there’s been no guarantee anything will proceed, and it looks like just confirmation of interests at this stage.

ANZ shares are down more than 20% in the past 12 months, and 20% this year to date, as seen on the chart below.

The post Why might ASX-listed ANZ want to snap up MYOB? appeared first on The Motley Fool Australia.

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More reading

• Surprise US inflation pumps the brakes on ASX 200 bank shares
• What’s the outlook in FY23 for ASX 200 bank shares?
• ASX 200 midday update: ANZ confirms MYOB talks, energy shares fall
• ANZ share price drops amid MYOB takeover talks
• Are falling BNPL shares pushing the ASX banks higher 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 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 EML Payments Ltd (ASX: EML) share price recovered some lost ground today.

This comes after the company’s former managing director and CEO posted a message on his LinkedIn profile regarding his departure from the company.

At Thursday’s close, the payments company’s shares were swapping hands at $1.05, up 12.3%.

What did the former CEO say?

The EML Payments share price finally enjoyed some relief today having fallen in the three previous sessions, including a drop of almost 25% on Monday following the shock news of CEO Tom Cregan’s exit.

Cregan bid the company farewell today after 10 and half years at the helm. He noted the “incredible journey” of building the business with a dedicated team that brought “their A-game”.

Cregan mentioned how EML Payments turned its fortunes around from being a small-time player to a global behemoth.

However, he delved into the reason for the abrupt exit that left shareholders stunned on Monday.

Cregan said:

After more work hours, air miles and nights away from home that I care to remember, I was happy to move on to the next journey and was happy that I controlled that outcome.

I will miss the people and customers, but not the 6am starts and 10-11pm finishes most days of the week!

Furthermore, Cregan went on to congratulate Emma Shand on her appointment as the new managing director and CEO.

He mentioned that she has an ideal set of attributes to lead the company while spending considerable time in Europe to run its operations. That was something Cregan said he was no longer willing to do “from a personal and family standpoint”.

EML Payments share price snapshot

Today’s EMP Payments share price gains will no doubt being some relief to shareholders.

The company’s shares have suffered setbacks after continuously being targeted by short-sellers following a disappointing third-quarter trading update in April.

In the past 12 months, its shares are down 72%.

EML Payments has a market capitalisation of roughly $478.03 million.

The post EML Payments share price rebounds 12% after former CEO sheds more light appeared first on The Motley Fool Australia.

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More reading

• What’s the outlook for ASX BNPL shares in FY23?
• FY22 was a lousy period for ASX fintech shares. Here’s why
• Is FY23 going to be a winning year for ASX fintech shares?
• These were the best (and worst) performing ASX 200 sectors of FY22
• Why Costa, Domino’s, EML, and Novonix shares are dropping

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 positions in and has recommended EML Payments. The Motley Fool Australia has positions in and has recommended EML Payments. 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 dividend shares have been rising on investor radars in 2022 as increasing interest rates threaten to cut into capital gains in the year ahead.

If you’re on the hunt for income stocks just take note, that the 12-month yield you’re getting on ASX dividend shares in your portfolio is likely to be higher – or lower – than what you’ll find posted today. It’s also likely to vary from the yield other investors are earning.

That’s based on the original amount of your investment, not the current share value.

Here’s what we mean.

Calculating the yield from ASX dividend shares

To be clear we’re talking about trailing dividend yields here, which you can work out by dividing a company’s past 12-month dividend payouts by its current share price. That’s as opposed to a forward dividend yield, which relies on earnings forecasts.

To keep it simple, we’ll assume you’re buying all the shares in one swoop, rather than incrementally, via dollar cost averaging.

We’ll take two popular ASX dividend shares as our example, BHP Group Ltd (ASX: BHP) and National Australia Bank Ltd (ASX: NAB).

Both companies’ dividends come with full franking credits, meaning you get credit from the ATO for the 30% tax the company has already paid on its profits in Australia. This avoids double taxation.

So, why are the 12-month yields you’re getting from an ASX dividend share going to be markedly different from many other investors?

BHP and NAB

The answer to that question lies when you buy the shares.

Starting with BHP, the S&P/ASX 200 Index (ASX: XJO) listed miner made two dividend payments in the past 12 months, totalling $4.80.

At the current share price of $37.92, this works out to a dividend yield of 12.8%.

To have received both payments you would have had to buy BHP shares on or before 2 September 2021.

Now here’s how yields for this ASX dividend share can vary significantly between investors.

On 4 August BHP shares were trading for $54.06. If you bought shares then, your 12-month yield on those shares is 8.9%.

On the other hand, if you’d bought BHP shares on 20 August, when the miner was trading for $44.34, your 12-month yield would be 10.8%.

In other words, a two-week variance in buying this ASX dividend share resulted in a 1.9% difference in the yield.

And neither figure is as impressive as the 12.8% yield you’ll find currently listed under today’s lower BHP share price.

Taking NAB as our second example, the big four bank also made two dividend payments over the past 12 months, totalling $1.40

At NAB’s current share price of $28.29, that’s a dividend yield of 5%.

To have received both payments you would have had to buy NAB shares on or before 15 November 2021.

But far from every investor who bought shares between 14 July and 15 November 2021 is receiving a 5% yield.

On 20 July, for example, the NAB share price stood at $25.47. Had you bought shares on that date, the yield from this ASX dividend share would be 5.5%.

But if you’d waited until 10 November to invest in NAB, you would have paid $30.15 per share. That would see your 12-month yield reduced to 4.6%.

In the first instance, your personal investment yield is higher than what you’d find posted based on today’s share price, and in the second case, it’s lower.

Foolish takeaway

Timing the market is no easy feat. And no one, to our knowledge, has demonstrated an ability to do so consistently.

Nonetheless, when you’re able to buy ASX dividend shares during a pullback rather than a bounce, your yields will benefit.

The post Why the yield you’re getting on ASX dividend shares may not be as advertised appeared first on The Motley Fool Australia.

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More reading

• Surprise US inflation pumps the brakes on ASX 200 bank shares
• These ASX 200 mining shares are bolstering the market today
• Why did the Rio Tinto and BHP share price struggle today?
• What’s the outlook in FY23 for ASX 200 bank shares?
• Analyst names 3 reasons to be bullish on the BHP share price

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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S&P/ASX 200 Index (ASX: XJO) shares spent most of Thursday in the green despite a rocky start to the session. The index closed 0.44% higher at 6,650.60 points.

The ASX 200’s day in the green came despite Wall Street struggling through Wednesday’s session. The S&P 500 Index (SP: .INX) slipped 0.45% overnight while the Dow Jones Industrial Average Index (DJX: .DJI) fell 0.67% and the Nasdaq Composite (NASDAQ: .IXIC) slumped 0.15%.

The S&P/ASX 200 Materials Index (ASX: XMJ) was among the Australian market’s top performers today, lifting by 1.56% and driven higher by some of its biggest constituents.

It was likely also helped along by iron ore futures. They rose 1.9% to US$110.26 a tonne overnight.

ASX 200 energy stocks also outperformed after oil prices lifted slightly and the price of thermal coal shot up again, gaining 0.9% to reach US$430 per tonne.

Meanwhile, the S&P/ASX 200 Real Estate Index (ASX: XRE) and S&P/ASX 200 Financial Index (ASX: XFJ) both slumped around 1%, potentially impacted by a major surge in US inflation.

So, with all that in mind, which stocks outperformed all others on Thursday? Keep reading to find out.

Top 10 ASX shares countdown

And the top-performing share of the ASX’s 200 biggest companies by market capitalisation on Thursday was – perhaps unsurprisingly – Yancoal Australia Ltd (ASX: YAL).

The coal producer’s stock closed 10.29% higher at $5.68. Read more about Yancoal here.

Today’s top 10 biggest gains were made by these ASX shares:

ASX-listed company	Share price	Price change
Yancoal Australia Ltd (ASX: YAL)	$5.68	10.29%
Chalice Mining Ltd (ASX: CHN)	$3.99	8.42%
Coronado Global Resources Inc (ASX: CRN)	$1.74	8.07%
Whitehaven Coal Ltd (ASX: WHC)	$5.74	6.49%
Lynas Rare Earths Ltd (ASX: LYC)	$8.12	6.01%
New Hope Corporation Limited (ASX: NHC)	$4.25	5.72%
Mineral Resources Limited (ASX: MIN)	$46.91	5.68%
GQG Partners Inc (ASX: GQG)	$1.33	4.74%
Netwealth Group Ltd (ASX: NWL)	$13.05	4.74%
Latitude Group Holdings Ltd (ASX: LFS)	$1.56	4.35%

Data as at 4.40pm AEST.

Our top 10 ASX shares today countdown is a recurring end-of-day summary to ensure you know which companies were making big moves on the day. Check in at Fool.com.au after the market has closed during weekdays to see which stocks make the countdown.

The post Here are the top 10 ASX shares today appeared first on The Motley Fool Australia.

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More reading

• Why did the Pointsbet share price leap 7% on Thursday?
• What’s behind the Chalice Mining share price jumping 7% today?
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Could this be why the Lynas share price is rallying 6% today?
• TPG share price rises as telco hits back at Optus over ‘factual errors’

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 positions in and has recommended Netwealth. The Motley Fool Australia has positions in and has recommended Netwealth. 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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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.

As the S&P 500 just had its worst first-half performance of any year since 1970, the cryptocurrency market has also fallen off a cliff. After approaching a total value of nearly $3 trillion last November, the entire market is now worth just $888 billion as of this writing. Amid the bear market, investors are fearing a recession is on the horizon, causing them to sell off risky assets. 

The world’s most valuable cryptocurrency, Bitcoin (CRYPTO: BTC), has also cratered. However, I think there’s a good chance that it eventually bounces back. Its price (on the afternoon of July 12) was $19,907 down from an all-time high of $68,790, but there’s a clear path for it to one day reach $300,000. And that would equate to a monster 15-fold return. 

Bitcoin as a medium of exchange 

Launched in January 2009, Bitcoin’s creation was truly revolutionary. A borderless, peer-to-peer internet-based currency completely upends the traditional monetary and financial system, one that is controlled by governments. While the idea was sound and made sense, Bitcoin’s actual adoption in commerce has been unimpressive. 

According to Cryptwerk, Bitcoin today is directly accepted as a method of payment at 7,879 different merchants. And although there are a number of different financial services that allow users to spend with Bitcoin, like Coinbase‘s Visa debit card and PayPal‘s Checkout with Crypto feature, consumers aren’t really incentivized to do this. 

Why use Bitcoin, an appreciating asset that triggers a tax liability when sold, to pay for things? You’re much better off buying and holding this digital asset. Spending fiat, or government-issued currency, on the other hand, is what has worked because it is constantly being inflated by massive stimulative measures. Maybe this situation changes in the future, but right now, I don’t see how Bitcoin can become an effective medium of exchange. 

Bitcoin as digital gold 

Many Bitcoin bulls want the top cryptocurrency to become a true medium of exchange, but in its 13-year history, this use case hasn’t caught on. Instead, Bitcoin’s most promising use case is that it continues to become more popular as a legitimate store of value, or digital gold. 

Despite the recent market drawdown, both individual and institutional investors are increasingly allocating small portions of their portfolios to Bitcoin. Whether it is viewed as an inflation hedge or simply as a way to diversify holdings, I believe that as familiarity and understanding of Bitcoin continue to rise over time, more people will own it. 

Compared to gold, Bitcoin has some key advantages. Bitcoin is absolutely finite, as there will ever only be 21 million coins created. The supply of gold, on the other hand, can increase if the price of the precious metal rises enough to justify finding and opening new mines. As mentioned, Bitcoin can be used in transactions, a characteristic gold doesn’t have. Furthermore, Bitcoin is divisible and a lot easier to store. 

Bitcoin’s market cap today of $380 billion is roughly 3% of the $12.5 trillion of gold in the world. Even if Bitcoin one day represents 50% of the gold market, which isn’t a huge stretch of the imagination, its market cap would be $6.3 trillion. And the price of one Bitcoin at that point easily eclipses $300,000. I have no clue as to the timeframe of this happening, but it appears to be Bitcoin’s most likely path to significant price appreciation. 

Bitcoin in the remittance market 

There is another exciting use case that Bitcoin could positively impact, and that’s the market for global remittances. Workers in the U.S. sent $74.6 billion back home to family in other countries, with an average fee of 6% on a $200 transaction. With Bitcoin, the fee is essentially nonexistent. Furthermore, remittances seem to fit perfectly with Bitcoin’s narrative of being a borderless global currency. 

This is a major possibility of unlocking real economic value. The World Bank estimates that this year, $630 billion will be sent as remittances from economic powerhouse nations to low- and middle-income countries. Six percent of that massive amount equals $37.8 billion, a material sum that can immediately go from paying for fees to having a positive economic impact for those involved. 

But as things stand today, Bitcoin’s biggest hope is to find a place in a greater number of investment portfolios. And if it can become a reasonable substitute for owning gold, a $300,000 price target is an honest possibility over the long term. 

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

The post Here’s Bitcoin’s only path to $300,000 appeared first on The Motley Fool Australia.

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More reading

• Why are Bitcoin miners shutting down in Texas?
• Is the Bitcoin price heading down to US$10,000? Here’s Wall Street’s take
• What went so right and so wrong for the Bitcoin price in the 2022 financial year?
• Why did the Bitcoin price crash 41% in June?
• Why Bitcoin stocks crashed (again) last month

Neil Patel has positions in Bitcoin and Coinbase Global, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin, Coinbase Global, Inc., PayPal Holdings, and Visa. The Motley Fool Australia owns and has recommended Bitcoin. The Motley Fool Australia has recommended PayPal Holdings. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. 

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

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