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The good thing about ASX exchange-traded funds (ETFs) is that they offer investors ways to invest in all types of shares.

This includes dividend shares, which means that income investors can use them to build out an income portfolio effortlessly.

But which ASX ETFs would be good options for income investors? And how much would a $20,000 generate in dividends? Let’s look at two popular options:

BetaShares S&P 500 Yield Maximiser (ASX: UMAX)

The BetaShares S&P 500 Yield Maximiser could be an ASX ETF to buy for income.

As its name suggests, this ETF maximises the yields from the top 500 companies listed on Wall Street. This includes giants such as Apple, Exxon Mobil, Johnson & Johnson, and Walmart.

And when I say maximise, I mean it. The S&P 500 index currently trades with a dividend yield of approximately 1.5%. However, this ETF’s actively managed covered call strategy means it aims to pay out significantly more.

For example, at the last count, its units were providing investors with a 5.1% dividend yield. This means that a $20,000 investment would provide $1,020 of income.

Vanguard Australian Shares Index ETF (ASX: VHY)

Another ASX ETF for income investors to look at is the Vanguard Australian Shares High Yield ETF.

This popular funds gives investors low-cost exposure to a diverse group of ~70 ASX shares that have higher forecast dividends relative to the market average.

Among its holdings are big miners and banks, such as BHP Group Ltd (ASX: BHP) and Commonwealth Bank of Australia (ASX: CBA), as well as smaller names like Metcash Limited (ASX: MTS) and Eagers Automotive Ltd (ASX: APE).

At present, the ETF currently trades with a trailing dividend yield of 5.1%. This would also generate $1,020 of income from a $20,000 investment.

The post Here’s how much income you’d get from $20,000 invested in these ASX ETFs appeared first on The Motley Fool Australia.

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More reading

• These ASX income ETFs could be top buys
• Buy these fantastic ASX ETFs for passive income and growth
• How I’d create investment cash flow in retirement from ASX ETFs

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 positions in and has recommended Apple and Walmart. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Johnson & Johnson. The Motley Fool Australia has positions in and/or has recommended BetaShares S&P 500 Yield Maximiser Fund, Metcash, and Eagers Automotive. The Motley Fool Australia has recommended Apple and Vanguard Australian Shares High Yield ETF. 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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While the interest rates on term deposits have improved, they still fall short of the dividend yields available on the Australian share market.

In addition, with interest rates tipped to fall over the next 12 months, we might have already seen the peak for term deposits.

As a result, income investors may get better outcomes with the buy-rated ASX dividend shares named below. Here’s what you need to know about them:

Accent Group Ltd (ASX: AX1)

The team at Bell Potter is feeling positive about Accent Group. It is the footwear retailer behind brands such as The Athlete’s Foot, HYPEDC, and Sneaker Lab. Bell Potter currently has a buy rating and $2.50 price target on its shares.

As for those all-important dividends, Bell Potter is forecasting fully franked dividends per share of 12 cents in FY 2024 and then 14.1 cents in FY 2025. Based on the Accent share price of $2.12, this represents dividend yields of 5.7% and 6.65%, respectively.

Orora Ltd (ASX: ORA)

Goldman Sachs thinks investors should be buying this packaging company. It likes Orora due to its defensive qualities and positive growth outlook. The broker has a buy rating and $3.50 price target on its shares.

In respect to income, the broker has pencilled in dividends per share of 14 cents in FY 2024, 15 cents in FY 2025, and 16 cents in FY 2026. Based on the current Orora share price of $2.84, this will mean yields of 4.9%, 5.2%, and 5.6%, respectively.

Rural Funds Group (ASX: RFF)

This agricultural property company could be an ASX dividend share to buy according to analysts at Bell Potter. The broker currently has a buy rating and $2.40 price target on its shares.

As for dividends, Bell Potter is forecasting dividends per share of 11.7 cents in both FY 2024 and FY 2025. Based on the current Rural Funds share price of $2.22, this will mean yields of 5.3% for investors.

The post Forget term deposits and buy these ASX dividend shares appeared first on The Motley Fool Australia.

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More reading

• 6 oversold ASX shares to buy in February 2024
• Buy ANZ and these ASX dividend stocks now
• Here are the top 10 ASX 200 shares today
• 3 ASX dividend shares for income investors to buy now
• How can I make $1,000 a month from ASX shares?

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 positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended Rural Funds Group. The Motley Fool Australia has recommended Accent Group and Orora. 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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Regular readers would know that there are many ways to reach the magic million using the power of ASX shares and compounding.

However, what you’re really wanting to know is which stocks will take you there.

One stock that many experts are bullish on is low-cost jewellery retailer Lovisa Holdings Ltd (ASX: LOV).

Let’s examine whether Lovisa shares have the chops to take you to seven figures:

What does Lovisa do?

Lovisa operates a network of “fast fashion” jewellery shops both in Australia and overseas.

Although the business started in Sydney, its stores can now be seen in places as far-flung as Hong Kong, Namibia, France, the US, the UAE, and Colombia.

The retail chain has a presence in 40 countries via 830+ stores, according to the last quarterly update.

How is the business going?

Although it’s definitely a consumer discretionary stock, Lovisa has withstood the recent economic downturn better than some others because of its low-cost niche.

Its target demographic also skews to younger generations, who are less likely to be under pressure from higher mortgage repayments.

The company is also on an expansion tear, with its first store openings in China and Vietnam imminent. They are both countries that have a fast-growing middle class market.

Total sales in the September quarter grew 17% year-over-year, while the 2023 financial year numbers saw revenue rise 30%, earnings before interest and tax (EBIT) increase 27.9%, and net profit after tax (NPAT) head up 16.7%.

Are Lovisa shares a millionaire maker?

Lovisa is an unusual investment in that it can be considered both a growth stock and a dividend producer.

The share price has gained an amazing 239% over the past five years. Meanwhile the stock has paid out a 2.9% dividend yield, which is 70% franked.

Of course, if you had the foresight to buy Lovisa shares a half-decade ago, that yield would now incredibly exceed 9.5%.

And the professional community is largely optimistic about the business’ outlook.

Nine out of 14 analysts currently surveyed on CMC Invest reckon the stock is a buy.

So, yes, Lovisa shares have a decent chance of making you a millionaire.

Buyer beware though

But there are two caveats.

The first is that if you buy this stock, it should be part of a well-diversified portfolio. 

There are no certainties in life. So you’ll want to make sure if Lovisa doesn’t perform as expected, other stocks could step up.

The second is that the past is no guarantee of future performance.

The last five years have been pretty impressive for Lovisa shares, but that says nothing about how they will go in the next five.

The post Could Lovisa shares help you become a millionaire? appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Top brokers name 3 ASX shares to buy today
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• Buy these ASX growth shares for market-beating returns

Motley Fool contributor Tony Yoo has positions in Lovisa. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Lovisa. The Motley Fool Australia has recommended Lovisa. 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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It’s well known that Australians between the ages of 30 and 50 don’t exactly pay as much attention to their superannuation balances as those who are closer to the traditional retirement age.

On one hand, that’s fair enough. If you’re 30 years old, retirement probably seems like a distant pipedream. Certainly not something that’s worthy of as much thought as career advancement.

But I would argue that we should all be paying our super funds some attention every once in a while, regardless of our age. Superannuation is our best shot at a comfortable, self-funded retirement, after all. And thanks to the power of compounding, the earlier we show it some love, the better off we’ll be.

A few weeks ago, we took stock of what the average and median superannuation balances were for Australians aged 60, 65 and 70.

But today, we’re going to check out how those numbers look for Australians aged 30, 40 and 50. It might be worth seeing how your own super fund measures up to what the average person in your age group has.

What’s the average superannuation balance at 30, 40 and 50?

So again, we’ll be using the numbers from the Australian Taxation Office (ATO)’s Taxation Statistics report. This report pulled data from the 2021 financial year.

According to the ATO’s data, the median super balance for Australians aged between 30 and 34 in FY21 was $38,681. That compares to an average balance of $51,400. Remember, the average statistic is more heavily influenced by outsized numbers than the median.

For someone between the ages of 40 and 44, the median balance was $91,590. That was with an average superannuation balance of $123,993.

For Australians aged between 50 and 54, we get a median figure of $137,930 and an average balance of $215,115.

These figures might not mean too much to someone who’s 30 or perhaps even 40 right now. But it’s well worth checking out how your own superannuation fund compares to these average and median figures.

As we covered last year, AMP has estimated the amount that a single retiree (who already owns their own home outright) will need in their superannuation nest egg to fund a comfortable retirement. Those analysts came up with a figure of $1.25 million in today’s dollars. It was a lump sum of $795,000 to pay for even a modest retirement.

If you plug in the numbers for your own fund, you might find that your super balance could need a boost. That’s if you’re hoping to get to that rainbow’s end at the conclusion of your working life.

The post What’s the average Aussie superannuation balance at age 30, 40 and 50? appeared first on The Motley Fool Australia.

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More reading

• Shares vs. property: Beginner investors choosing Aussie shares, ASX ETFs and rentvesting
• ASX dividend shares: What’s better, growth or consistency?
• Should I still be buying ASX shares in retirement?
• 2 sizzling-hot ASX stocks to buy right now
• 3 excellent ASX ETFs for beginner investors

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 Scott Phillips.

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Young Australians just starting their investment journeys are making some similar decisions, data shows.

Shares vs. property is typically the first big decision any budding investor has to make.

Of course, there are other options like simple savings accounts and bonds, but most people think of shares and property first when contemplating long-term investment for retirement.

There are lots of factors to consider in the choice of shares vs. property, but the overarching one is quite simple. Can you get enough finance to buy what you want?

Interest rates on investment property loans are at about 6%. Then the banks add a 3% ‘mortgage serviceability buffer’, as directed by APRA, to assess your long-term ability to keep up with repayments.

Being assessed at 9% makes it very hard for younger Australians to get a loan big enough for a property purchase. After all, the Australian median home value is just over three-quarters of a million dollars.

So, the affordability of property itself coupled with the difficulties of getting enough finance are big issues for beginner investors preferring bricks and mortar to shares.

But as always, the free market finds ways to adapt when challenges arise.

Shares vs. property: The path to investment

Most beginner investors can buy ASX shares tomorrow. All they need is an online broking account and a minimum of $500 in savings to make that first trade through any of the big banks.

Property is harder.

Historically, the traditional path to property investment started later in life, after first home ownership.

Back in the 1970s and 80s, most Aussies aspired to own a family home on a quarter-acre block. That was the Great Australian Dream. Then later down the track, some of those homeowners would use the equity in their residences to fund a single property investment for their retirement. That was the ‘ideal’ realised.

But over the years, the Great Australian Dream became difficult to afford. As the population grew, home prices rose more rapidly in the desirable inner city suburbs closest to work in the CBD.

So young Gen X Australians began buying further away, which led to the dawn of the commuter lifestyle. Those young families reasoned that owning a home outweighed the inconvenience of long travel to work. But eventually, those properties on the outskirts also became hard to afford, as land values shot up.

So, young people went back to the inner city and bought apartments instead. The dream of a quarter acre was lost, but home ownership remained the priority, with investment to come later in life as it always had.

Then those inner city units became expensive.

So, the next generation — the millennials — came up with a new idea. They changed the Great Australian Dream from home ownership to property ownership, with investment coming first, ahead of ownership.

That spawned a new market trend: Rentvesting.

What is rentvesting?

Rentvesting is where a young person rents where they want to live — typically a trendy inner city lifestyle area where they can’t afford to buy — and purchases an investment property wherever they can afford it.

The rent helps them pay the mortgage, and they hope for enough capital growth over time to fund a deposit on a home in a location where they actually want to live themselves, later down the track.

This choice is facilitated by it being easier to get an investment loan than a home loan. This is because the property’s rental income counts as part of the bank’s serviceability and income assessment of you.

Rentvesting has become such a significant trend that in 2019, the Australian Bureau of Statistics (ABS) began separately reporting the number of new loans going to first-time buyers purchasing for investment as opposed to owner-occupation.

Last year, 7,412 young Australians took out loans to rentvest, according to ABS lending finance data.

In 2022, it was 8,243. In 2021, it was 10,678.

That decline over recent years may be the result of interest rates rapidly increasing since May 2022.

Are more beginner investors choosing shares vs. property?

The rapid growth in property values over the past 20 years could be a factor in data that indicates more beginner investors may be choosing shares vs. property.

According to the 2023 ASX Australian Investor Study, 32% of 18 to 24-year-old investors own investment property vs. 43% who own ASX shares. Some may own both, but you see the difference.

Among 25 to 49-year-old investors, 42% own investment property vs. 52% who own ASX shares.

Which ASX shares do beginner investors like most?

ASX shares are the most popular category of stocks among both age groups.

The second-most popular category is exchange-traded funds (ETFs).

The data shows that 33% of 18 to 24-year-old investors and 29% of 25 to 49-year-olds own ETFs.

ETFs are a relatively new investment phenomenon. ETFs were introduced on the ASX in 2001. They are increasingly popular, with 2023 being a record year for growth for these investment products.

ASX ETF provider BetaShares says investors funnelled $15 billion net into ETFs last year. This, along with gains in asset values, led to the highest increase in annual funds under management (FUM) within the Australian ETF industry, ever.

In terms of specific shares favoured by younger investors, broker Selfwealth Ltd (ASX: SWF) released some data last year naming the most popular ASX shares among millennials.

They were as follows.

(Fun fact: Many of these ETFs below hit new 52-week high share prices yesterday.)

Most popular ASX shares and ETFs among millennial investors

Vanguard Australian Shares Index ETF (ASX: VAS)

Vanguard Diversified High Growth Index ETF (ASX: VDHG)

Vanguard MSCI Index International Shares ETF (ASX: VGS)

iShares S&P 500 ETF (ASX: IVV)

Betashares Nasdaq 100 ETF (ASX: NDQ)

Fortescue Ltd (ASX: FMG)

Core Lithium Ltd (ASX: CXO)

Pilbara Minerals Ltd (ASX: PLS)

The post Shares vs. property: Beginner investors choosing Aussie shares, ASX ETFs and rentvesting appeared first on The Motley Fool Australia.

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More reading

• 3 excellent ASX ETFs for beginner investors
• 5 ASX shares to buy and hold forever in your investment portfolio
• 2 picks I’d buy for my ASX share portfolio in February
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• 8 popular ASX ETFs smashing new 52-week highs

Motley Fool contributor Bronwyn Allen has positions in Core Lithium, Vanguard Australian Shares Index ETF, and Vanguard Diversified High Growth Index ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended BetaShares Nasdaq 100 ETF and iShares S&P 500 ETF. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended Vanguard Msci Index International Shares ETF and iShares S&P 500 ETF. 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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When it comes to ASX dividend shares, it’s typically the stocks offering the highest fully-franked yields that get the most attention.

That’s why most investors will name the likes of Westpac Banking Corp (ASX: WBC) and BHP Group Ltd (ASX: WDS) when asked which ASX dividend shares they like rather than something like WiseTech Global Ltd (ASX: WTC) or Washington H. Soul Pattinson and Co Ltd (ASX: SOL).

Sure, there is something to be said of the massive and immediate flow of passive income when buying a high-yielding share. But are consistent high-paying ASX dividend shares better than those with small dividend payments but that grow them over time?

ASX dividend shares: growth vs. consistency

I think this question comes down to your personal circumstances and preferences. For older investors who have perhaps retired, cash flow and franking credits are usually the most important considerations when selecting income-paying shares, with capital growth and maximising returns playing second fiddle.

As such, it might make more sense to target those consistently high-yielding ASX dividend shares like Westpac or BHP if you fall into that category.

After all, if you’re in your 70s or 80s, there’s arguably less incentive to buy low-yielding ASX dividend shares that might have a massive yield in 20 years’ time.

However, that’s not the approach I’m taking with my own portfolio. Since I’m still many years away from retirement, maximising my overall returns is a far more pressing goal than maximising dividend cash flow.

Looking at the share prices of some of the ASX’s most prolific dividend payers, it’s clear that many of these companies sacrifice growth opportunities in order to keep their dividends at the highest levels possible.

Westpac? You can buy this ASX bank’s shares today for the same price as you could way back in April 2006. Sure, It’s got a 5.85% fully franked dividend yield at present. But you don’t get too much more than that.

It’s a similar story with BHP. Today, investors who picked up BHP shares at the height of the 2008 mining boom can sell them back without taking much in the way of gains.

High dividend payments have a price.

Income growth comes with share price growth too

I much prefer the likes of Washington H. Soul Pattinson. Soul Patts shares may only offer a dividend yield of 2.58% today. But, as we discussed just yesterday, someone who invested in this prolific dividend grower would have grown their dividend yield on cost from 2.67% up to 22.3%.

That’s the position that I think is most conducive to long-term returns. Remember, if an ASX dividend share is consistently growing its profits, it will be able to raise its shareholder payouts over time.

This usually walks hand in hand with the price rises too. Over the 23 years that Soul Patts has hiked its annual dividend from 10.4 cents to 87 cents, its share price has also grown by more than 765%.

Another ASX dividend share I’d consider for growing dividends, and a potentially high future yield on cost is Wisetech Global.

This tech stock first started paying dividends in 2017. That year, investors enjoyed a total of 2.2 cents per share in payouts. But in 2023, Wisetech doled out a total of 15 cents per share.

Yet despite this huge ramp-up in raw dividends going to shareholders, its yield still looks pitiful today at 0.2%. But bear in mind this is because the WiseTech share price has also ballooned 10-fold since 2017.

If it’s between WiseTech and Westpac, between BHP and Soul Patts, I’m going to take the ASX dividend share grower any day of the week.

The post ASX dividend shares: What’s better, growth or consistency? appeared first on The Motley Fool Australia.

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More reading

• Which Big Four ASX bank share will pay the biggest dividend this year?
• Why has the Westpac share price just hit a 52-week high?
• Soul Patts shares: Here’s how some investors are getting a 22% yield
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Motley Fool contributor Sebastian Bowen has positions in Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Washington H. Soul Pattinson and Company Limited and WiseTech Global. The Motley Fool Australia has positions in and has recommended Washington H. Soul Pattinson and Company Limited and WiseTech Global. 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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Retirement is a very important phase of our economic lives. ASX shares can help build our wealth, but does entering our golden years mean no more ASX investing?

Every retiree’s finances and budget are different. Some people may only have enough to pay for the bare essentials. Putting food on the table and having a roof over one’s head is more important than buying a few ASX shares.

But, is it a good idea to keep investing in ASX shares for the people in retirement who have some financial flexibility?

Make space for enjoying life

Being in retirement will hopefully mean cutting down on working and taking more time for leisure, entertainment, family and other enjoyable activities.

Some people may have spent a lifetime saving, so it may be a bit foreign to purposefully choose to spend money rather than accumulating as much as possible.

I occasionally make the point that there’s value in enjoying life today, rather than delaying it for many years down the track. For example, kids are only going to be kids for so long. My view is that there’s not much use saying to a 10-year-old that you’ll go to Disneyland in 10 years because it’s better for compounding money – they will be 20 by then and (probably) too old!

I’d suggest it’s a similar thing in retirement. If someone has a travel goal or something like that, it’s better to enjoy it now while we’re still most able to.

In my eyes, life experiences are the most important things to spend our money on.

Keep an eye on the ASX share portfolio, but don’t tinker needlessly

I’m a big advocate for long-term investing, so I hope that the number of ASX share sales in retirement can be minimal – unless the capital is needed. The less investment decisions we make, the less stressful that will be.

But, at the same time, I’d point out that if someone retires they’ll probably still need their money to last 10, 20 years or even more. Over that time, I think it’s certainly possible that investors may need to change their ASX share portfolio over that time and make new investments. Even Warren Buffett makes changes in the Berkshire Hathaway portfolio every so often.

Having said all of that, and assuming the retiree has enough money to keep spending on essentials and experiences, any leftover money could be invested in ASX shares to make sure the money works as hard as it can while it’s not needed.

In my opinion, (ASX) shares are capable of producing the best long-term returns of all asset classes, so while it may be wise to invest a bit more cautiously in retirement, there are still plenty of potential good years of investing in ASX shares. It could help the later years of retirement (such as aged care) or just fund better holidays.

Which ASX shares could retirees invest in? Well, that’s what The Motley Fool’s offering is all about – finding good ASX shares to invest in.

The post Should I still be buying ASX shares in retirement? appeared first on The Motley Fool Australia.

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More reading

• 2 sizzling-hot ASX stocks to buy right now
• 3 excellent ASX ETFs for beginner investors
• 2 ASX dividend shares to double up on right now
• No passive income at 50? I’d use Warren Buffett’s methods to get rich
• 6 oversold ASX shares to buy in February 2024

Motley Fool contributor Tristan Harrison 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 Berkshire Hathaway. The Motley Fool Australia has recommended Berkshire Hathaway. 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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Often when ASX stocks have risen strongly, investors will think they have missed the boat.

They may then think it’s better to wait for a pullback to happen in order to try and get in at a better price.

While sometimes this may happen, more often than not, high-quality, sizzling hot ASX stocks don’t come back to earth in a hurry.

Or at least, if they do, they’ve already gone another 25% higher before pulling back 10%. This means you end up paying more than you would have done if you just snapped them up earlier.

With that in mind, let’s take a look at a couple of ASX stocks that are sizzling hot and could still offer great returns for investors. They are as follows:

Megaport Ltd (ASX: MP1)

This elasticity connectivity and network services interconnection provider’s shares are the epitome of sizzling in 2024. Since the start of the year, the ASX stock has risen approximately 40%. This extends its 12-month return to 120%.

The driver of this has been the release of a strong quarterly update. Megaport reported total revenue of $48.6 million and EBITDA of $30 million, which was well ahead of expectations.

Analysts at Macquarie believe the strong form can continue. In response to the update, the broker has put an outperform rating and $15.50 price target on its shares. This implies 20% upside for investors.

NextDC Ltd (ASX: NXT)

Another ASX stock to look at is data centre operator NextDC. Its shares have rallied approximately 40% over the last 12 months and more than 120% since the start of 2020.

Investors have been buying the company’s shares due to its strong top line and profit growth, which is being underpinned by the insatiable demand for capacity in its data centres. Pleasingly, this is only expected to continue to increase as generative AI drives a third-wave of demand.

The team at UBS still sees a lot of value in its shares. It has a buy rating and $17.20 price target on them, which suggests almost 20% upside.

The post 2 sizzling-hot ASX stocks to buy right now appeared first on The Motley Fool Australia.

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More reading

• CBA could be eyeing record profits if first-half results echo the past
• 5 things to watch on the ASX 200 on Friday
• Guess which ASX 200 stock is leading the share price gains in 2024?
• Brokers say these 3 ASX dividend shares are buys
• Why Macquarie shares could be poised for an AI windfall

Motley Fool contributor James Mickleboro has positions in Nextdc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group and Megaport. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Megaport. 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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If you’re a beginner investor and not overly keen on stock picking right now, then you could consider buying some exchange traded funds (ETFs) instead.

As these funds allow you to invest in a large number of shares in one fell swoop, it means you can effectively build a diversified portfolio instantly without having to break the bank.

But which ASX ETFs could be good options for beginners?

Listed below are three high quality option to consider buying. They are as follows:

BetaShares NASDAQ 100 ETF (ASX: NDQ)

The BetaShares NASDAQ 100 ETF could be a great option for beginners. This hugely popular fund gives investors access to the 100 largest non-financial shares on the famous NASDAQ exchange on Wall Street. These are the absolute titans of our time and include giants such as Alphabet, Amazon, Apple, Meta, Microsoft, and Tesla.

VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)

Another great option for beginner investors could be the VanEck Vectors Morningstar Wide Moat ETF. This ETF gives investors exposure to the type of companies that Warren Buffett would buy. These are companies with sustainable competitive advantages and fair valuations. And given Buffett’s market-beating record over many decades, it could pay to follow his investment style.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

A final ASX ETF for beginner investors to consider buying is the Vanguard MSCI Index International Shares ETF. It allows investors to buy a slice of a whopping ~1,500 of the world’s largest listed companies from major developed countries. Vanguard notes that this allows them to participate in the long-term growth potential of international economies.

The post 3 excellent ASX ETFs for beginner investors appeared first on The Motley Fool Australia.

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More reading

• 2 picks I’d buy for my ASX share portfolio in February
• 5 reasons to buy an ASX index fund today
• 8 popular ASX ETFs smashing new 52-week highs
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• 5 ASX shares I think you can confidently invest $500 in right now

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor James Mickleboro has positions in BetaShares Nasdaq 100 ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, Apple, BetaShares Nasdaq 100 ETF, Meta Platforms, Microsoft, and Tesla. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended Alphabet, Amazon, Apple, Meta Platforms, VanEck Morningstar Wide Moat ETF, and Vanguard Msci Index International Shares ETF. 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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Undervalued ASX dividend shares could be a great source of passive income.

At a time when interest rate cuts seem to be on the horizon, it could be a good idea to look at names that may be materially lower today than where they may be in a couple of years.

I’m not expecting 2024 to be the strongest, operationally, for the below two stocks, but I think the medium-to-longer-term is very promising.

Scentre Group (ASX: SCG)

Scentre is a real estate investment trust (REIT) that owns Westfield shopping centres in Australia and New Zealand. It has 37 locations in Australia and five in New Zealand.

A few months ago, the business reported its quarterly update for the period ending September 2023.

It reported portfolio occupancy of 99.1%, up 30 basis points (0.30%), year over year. The ASX dividend share also said that the average specialty rent escalation had been 7.6% in the year-to-date. New rental contracts saw a 3.6% increase in the three months to September 2023.

Total business partner (tenant) sales within Scentre were 13.7% higher in the three months to September compared to the same period in 2019.

The ASX dividend share continues to invest in its shopping centres to renovate and improve them and unlock stronger rental potential.

While online shopping is a headwind, the growing population is a tailwind. Plus, the limited space for new shopping centres in cities means the business has a strong economic moat, in my mind.

It’s forecast to pay a distribution of at least 17.8 cents per security in FY25 and 20.3 cents per security in FY26, which are forward distribution yields of 5.7% and 6.5%.

Dusk Group Ltd (ASX: DSK)

Dusk describes itself as the leading Australian omni-channel specialty retailer focused on home fragrance products. It has candles, ultrasonic diffusers, reed diffusers, essential oils, as well as fragrance-related homewares.

The Dusk share price has dropped 45% in the past year and it’s down around 75% from July 2021. It’s a lot cheaper than it was, reflecting the more difficult retail conditions.

The company’s total sales for the first 20 weeks of FY24 were down 11.3% year over year, with bricks and mortar sales down 12.3% and online sales up 8%. Compared to the pre-pandemic period of FY20, total sales were up 30.1%. It reported it saw a slight improvement in sales trends from October onwards.

The ASX dividend share has continued to open new stores in Australia, opening six in the first half of FY24, which are located in “outer suburban and regional centres where the returns on investment remain attractive.” It’s expecting to open another four new stores in Australia in the second half of FY24 and close one store.

In December 2023 it expanded onto the Amazon marketplace.

FY24 could be tricky, with earnings expected to sink. The forecast numbers suggest earnings per share (EPS) of 7.2 cents and a dividend per share of 5.1 cents, which would imply a forward price/earnings (P/E) ratio of 14 and a forward grossed-up dividend yield of 7.3%.

But, the forecast is for a recovery in FY25 and FY26. Dusk could pay grossed-up dividend yields of 13.7% in FY25 and 16.6% in FY26.

The post 2 ASX dividend shares to double up on right now appeared first on The Motley Fool Australia.

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More reading

• Here’s how the ASX 200 market sectors stacked up this week
• ‘Bombed-out’ ASX REITs are bargain shares, says expert

Motley Fool contributor Tristan Harrison 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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