Tag: Motley Fool

The Australian share market certainly is not short of blue chips. But which ones should you buy over others?

To help narrow things down, listed below are two top blue chip ASX 200 shares that are rated as buys by experts. They are as follows:

CSL Limited (ASX: CSL)

The first blue chip ASX 200 share to consider is CSL. It is one of the world’s leading biotechnology companies and the name behind the CSL Behring and Seqirus businesses. CSL Behring is the global leader in a plasma therapies industry, whereas Seqirus is the number two player in the global influenza vaccines industry.

CSL has also just completed the acquisition of Vifor Pharma. This business, now known as CSL Vifor, is the global specialty pharmaceutical leader in iron deficiency, nephrology (kidney care), and cardio-renal therapies.

All three businesses appear well-placed for growth over the long term thanks to their high quality products and lucrative research and development pipelines. In addition, improving plasma collection conditions should be a boost to the company’s margins in the near term.

Citi is positive on CSL and currently has a buy rating and $340.00 price target on its shares.

Goodman Group (ASX: GMG)

Another blue chip ASX 200 share that has been tipped as a buy is Goodman Group.

It is a leading integrated commercial and industrial property company with a portfolio of high quality properties. Many of these properties have exposure to key growth markets such as ecommerce and logistics where demand is particularly strong. This has underpinned stellar earnings growth in recent years.

The team at Goldman Sachs believes that this strong form can continue thanks to “a number of favourable fundamentals underpinning future long-term demand for industrial space.” For example, it expects this to lead to operating earnings per share growth of ~17% in FY 2023.

Goldman has a buy rating and $25.40 price target on its shares.

The post 2 blue chip ASX 200 shares to boost your portfolio: experts appeared first on The Motley Fool Australia.

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More reading

• The CSL share price has gone backwards in 2022. Could a turnaround be ‘just starting to happen’?
• ASX 200 better buy: Cochlear or CSL shares?
• Goodman share price crumbles 5% amid Wall St woes
• The CSL share price dips as the ASX 200 dives on Wednesday
• Why I’m seriously considering buying these ASX shares following today’s market crash

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 CSL Ltd. 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 team at Morgans has recently named a number of shares that it rates highly.

Two that get the tick of approval are listed below. Here’s why its analysts have named these ASX shares as buys:

Lovisa Holdings Ltd (ASX: LOV)

This fashion jewellery retailer could be an ASX share to buy according to Morgans. It believes the company has huge growth potential thanks to its global expansion plans and strong position in an underserved niche.

Morgans currently has an add rating and $24.50 price target on the company’s shares. It commented:

LOV has a substantial multi-year global rollout opportunity across four continents. This opportunity has been materially boosted by the acquisition last year of beeline, which took LOV into several new European markets (notably Germany) and accelerated its expansion in France. We think LOV’s products fill an underserved niche, offering good quality fashion jewellery at prices that are attainable to the target demographic. The recent appointment of Victor Herrero as CEO, replacing Shane Fallscheer, provides a clue as to the extent of LOV’s global ambition, and its impatience to realise that ambition. The next few years will be worth watching.

NextDC Ltd (ASX: NXT)

Another ASX share that the broker is bullish on is data centre operator NextDC. Thanks to strong and growing demand for data centre capacity and its expanding network of world class centres, the broker is tipping NextDC to grow strongly in the coming years.

Morgans has an add rating and $13.30 price target on the company’s shares. It commented:

NXT should deliver a strong result at the upper end of guidance. Structural demand for cloud and colocation remains incredibly strong. NXT’s new S3 and M3 data centres go live shortly and this should result in significant new customer wins over the next six months (including CSP options being exercised). Sales should drive the share price higher. NXT looks comfortably on-track to generate over $300m of EBITDA in the next three to five years.

The post Broker names 2 top ASX shares to buy appeared first on The Motley Fool Australia.

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More reading

• Why Lake Resources, Lovisa, Megaport, and St Barbara shares are dropping
• 5 things to watch on the ASX 200 on Wednesday
• What’s driving ASX 200 consumer shares on Tuesday?
• 5 ASX All Ords shares going ex-dividend on Wednesday
• 62% upside: Expert names 2 ASX shares looking beautiful right now

Motley Fool contributor James Mickleboro has positions in NEXTDC Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Lovisa Holdings Ltd. 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 have a penchant for investing in small cap shares, then you might want to look at the three listed below.

Here’s why these are highly rated by analysts right now:

Audinate Group Limited (ASX: AD8)

The first small cap ASX share for investors to look at this week is Audinate.

It is the leading digital audio-visual networking technologies provider behind the Dante audio over IP networking solution.

The company highlights that this solution is the worldwide leader and used extensively in the professional live sound, commercial installation, broadcast, public address, and recording industries. Dante can replace traditional analogue cables by transmitting perfectly synchronised AV signals across large distances to multiple locations at once, using just an ethernet cable.

UBS is a big fan of the company. Last month, the broker put a buy rating and $10.20 price target on Audinate’s shares. This implies potential upside of over 20% for investors from current levels.

Bigtincan Holdings Ltd (ASX: BTH)

Another small cap ASX share for investors to look at this weekend is Bigtincan.

It is a growing provider of enterprise mobility software to sales and service organisations. This AI-powered sales enablement automation platform is designed to allow sales representatives to more effectively engage with customers.

It appears to work well judging by its growing customer base, which includes the likes of Nike, Guess, Prudential, and Starwood Hotels, and strong annual recurring revenue growth. The latter grew 126% to $120.1 million in FY 2022.

Morgan Stanley remains very positive on the company’s outlook and is expect further strong growth in FY 2023. So much so, it currently has an overweight rating and $1.15 price target on its shares. This is more than double its current share price.

The post 2 exciting small cap ASX shares analysts rate highly appeared first on The Motley Fool Australia.

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More reading

• Nitro now Tyro: Could there be ‘Potentia-l’ for other ASX tech shares?
• 4 ASX tech shares for the ‘patient investor’: expert
• Bigtincan share price climbs amid 143% revenue explosion
• Audinate share price slides despite record revenue and earnings

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 AUDINATEGL FPO and BIGTINCAN FPO. The Motley Fool Australia has positions in and has recommended AUDINATEGL FPO and BIGTINCAN FPO. 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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Choosing one ASX 200 share to hold forever is a big task. As we preach here at The Motley Fool, it’s never a good idea to confine your investment portfolio to just one share. There’s a lot of risk that comes with that. Not to mention forfeiting the famous ‘only free lunch of investing’, diversification.

But that doesn’t mean it’s not a constructive exercise. After all, the legendary investor Warren Buffett once offered this sage piece of advice:

I could improve your ultimate financial welfare by giving you a ticket with only 20 slots in it, so that you had 20 punches — representing all the investments that you got to make in a lifetime.

And once you’d punch through the card, you couldn’t make any more investments at all… you’d really have to think carefully about what you did, and you’d be forced to load up on what you really think about. So you’d do much better.

So what would be the one ASX share I would choose if I was given a ‘ticket with only one slot’?

Well, it would be a share I already happen to own: Washington H Soul Pattinson and Co Ltd (ASX: SOL).

Why I think Soul Patts is an ASX 200 forever share

This is for two compelling reasons. the first is this is a company that is more diversified than most. Soul Patts has a long history, having first opened up shop back in the 19th century. But these days, it is a long way from its pharmacy-running roots. It arguably functions more like a listed investment company (LIC) or a managed fund these days.

Soul Patts owns chunks of a variety of other ASX shares These include New Hope Corporation Limited (ASX: NHC) and TPG Telecom Ltd (ASX: TPG). As well as Brickworks Ltd (ASX: BKW) and Tuas Ltd (ASX: TUA).

So we have a coal miner, two telcos and a construction materials company. Already we see that Soul Patts has a highly diversified earnings base.

Adding to that is the massive portfolio of blue-chip ASX shares that Soul Patts acquired last year when it bought the old Milton Corporation.

It also has a burgeoning portfolio of unlisted assets too. These include Round Oak Metals, Ampcontrol, Aquatic Achievers Swim Schools and Ironbark Asset Management. Soul Patts also actively invests in pre-IPO emerging companies.

As such, I consider this share to be extremely well diversified. This makes up for the problematic situation of only owning one business.

Growth and dividends?

The second reason is this company’s long history of delivering for its shareholders. Since its founding, Soul Patts has proudly been run by the same family, which has significant skin in the game to boot.

But let’s get to the numbers.

So according to the company’s last half-year financial report, which was dropped back in January, Soul Patts investors have enjoyed total shareholders returns amounting to an average of 11% per annum over the past 15 years. That rises to 13% per annum over the past 20. Those returns smash the returns of the broader market.

Soul Patts is also the only ASX share that has rewarded its investors with an annual dividend pay rise every single year since 2000. The dividends typically come fully franked too.

So all in all, I think Soul Patts is a hands-down winner. As such, it would be my first and only pick if I was confined to just one ASX share for time immemorial.

The post If I had to own only one ASX 200 share forever, this would be it appeared first on The Motley Fool Australia.

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More reading

• ‘Good value’: Expert names 2 ASX dividend shares to pounce on next dip
• Why is ASX behemoth Soul Patts lending a hand to Electro Optic Systems?
• Why this ASX 200 share could be a great way to indirectly profit from booming coal prices
• How I’d invest $50,000 in ASX dividend shares for retirement, if I had to start from scratch
• How I’d invest $20,000 in ASX shares today if I had to start from scratch

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 Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended TPG Telecom Limited. 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 looking for an easy way to invest in international shares for diversification, then exchange traded funds (ETFs) could be the answer.

But which ETFs should you look at? Here are two popular ETFs that have generated strong returns for investors:

BetaShares Asia Technology Tigers ETF (ASX: ASIA)

This ETF gives investors easy access to ~50 of the largest technology and ecommerce companies that have their main area of business in Asia (excluding Japan).

This means you’ll be buying a piece of tech giants such as Alibaba, Baidu, JD.com, Meituan Dianping, Pinduoduo, Samsung, and Tencent Holdings.

In respect to Meituan Dianping, it is one of China’s largest e-commerce companies. Its apps connect consumers with local businesses for everything from food deliveries, hotel bookings, movie tickets, and many other services.

Meituan is also spending billions on developing autonomous delivery vehicles. This includes drone and self-driving car deliveries. So, could be one to watch very closely in the coming years.

Betashares Nasdaq 100 ETF (ASX: NDQ)

Another ETF to consider is the Betashares Nasdaq 100 ETF. This fund aims to track the performance of the famous NASDAQ-100 Index.

The NASDAQ-100 index comprises 100 of the largest non-financial companies listed on the world-famous NASDAQ market. BetaShares notes that this includes many companies that are at the forefront of the new economy.

Among its top holdings are Google parent Alphabet, Amazon, Apple, Facebook (Meta), Intel, Microsoft, Netflix, Nvidia, PayPal, and Tesla. None of these companies need an introduction. In fact, it is quite likely that readers have used many of their services in the last 24 hours.

Given their positive long term outlooks, this ETF could be a great buy and hold option for investors.

The post 2 outstanding ETFs for ASX investors to buy next week appeared first on The Motley Fool Australia.

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More reading

• Here’s why the BetaShares NASDAQ 100 ETF has tanked 4% today
• 2 excellent ETFs for ASX investors to buy this month
• 3 excellent ETFs for beginner investors to buy
• 3 wonderful ETFs for ASX investors to buy today
• Why is the Betashares Nasdaq 100 ETF leaping ahead on Thursday?

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 BETANASDAQ ETF UNITS. The Motley Fool Australia has positions in and has recommended BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended BetaShares Asia Technology Tigers 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 dividend-paying ASX shares, chances are one’s mind doesn’t immediately spring to the tech sector. There are many sectors on the ASX renowned for their hefty dividend payments. ASX bank shares? Of course. Resources? Definitely. But ASX tech shares? Not so much.

The S&P/ASX 200 Index (ASX: XJO) has many famous names in its tech sector. But few are famous for paying dividends. This is not unique to the ASX. Some of the largest tech companies in the world don’t pay dividends, despite some having mountains of cash on their balance sheet.

Giants like Amazon.com Inc (NASDAQ: AMZN), Meta Platforms Inc (NASDAQ: META) and Alphabet Inc (NASDAQ: GOOG)(NASDAQ: GOOGL) have never paid a dividend, despite all being valued at over US$1 trillion at various points in time.

But that doesn’t mean the ASX has no dividend-paying tech shares. So let’s embark on a mission to find the highest-yielding tech share on the ASX today.

So yes, plenty of ASX tech shares have never paid out a dividend. This includes Xero Limited (ASX: XRO), Zip Co Ltd (ASX: ZIP) and Block Inc (ASX: SQ2). Block’s Afterpay didn’t fund any dividends when it was an ASX share either.

But plenty of others do. Some ASX tech shares that currently pay dividends include Altium Limited (ASX: ALU), Appen Ltd (ASX: APX) and WiseTech Global Ltd (ASX: WTC).

Dicker Data dividend dominates the ASX tech sector

But these companies are not even close to being the highest-yielding ASX tech dividend share. That honour probably goes to Dicker Data Ltd (ASX: DDR).

Dicker Data is a company that provides a range of hardware, software and cloud-based technology services. It is probably best known for its hardware, which includes selling data storage, servers, networking equipment and more.

This company has spent the past few years cultivating what is now a fairly impressive dividend record. Dicker Data has been paying dividends consistently for over a decade now.

What’s more, it has managed to deliver a dividend pay rise every single year since 2012. That includes through the COVID-ravaged year of 2020.

In 2011, the company paid out a total of 9 cents per share in dividends. But this year, Dicker Data has doled out a total of 26 cents per share in dividends, all fully franked.

That gives this company a dividend yield of 4.87% at the market close share price on Friday, or 6.96% grossed-up with the full franking.

That is a decent dividend yield by any ASX standards, even coming in above what Commonwealth Bank of Australia (ASX: CBA) is offering right now. And compared to other ASX tech shares, it is certainly a sector leader.

The post Here’s the ASX tech share with the highest dividend yield right now appeared first on The Motley Fool Australia.

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More reading

• 3 beaten down ASX All Ords tech shares that are printing cash
• Why is the Dicker Data share price down 6% on Wednesday?
• Dicker Data share price placed on ice amid HY 2022 results and capital raise
• Analysts say these ASX dividend shares are buys 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, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Sebastian Bowen has positions in Alphabet (A shares), Amazon, and Meta Platforms, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet (A shares), Alphabet (C shares), Altium, Amazon, Appen Ltd, Block, Inc., Dicker Data Limited, Meta Platforms, Inc., WiseTech Global, Xero, and ZIPCOLTD FPO. The Motley Fool Australia has positions in and has recommended Block, Inc., Dicker Data Limited, WiseTech Global, and Xero. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, and Meta Platforms, Inc. 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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I’m a big advocate of buy and hold investing and believe it is the best way for investors to grow their wealth.

In light of this, to demonstrate how successful it can be, I occasionally like to pick out a number of popular ASX shares to see how much a single $20,000 investment 10 years ago would be worth now.

This time around I have picked out the two ASX shares that are listed below:

Breville Group Ltd (ASX: BRG)

It may not be an exciting tech share, but this appliance manufacturer has got its shareholders very excited over the last decade with some big returns. This has been driven by Breville’s consistently solid sales and earnings growth, which has been underpinned by the company’s ongoing investment into research and development, some high quality acquisitions, and its ongoing global expansion.

Over the last decade, Breville’s shares have thoroughly beaten the market with an average total return of 16.1% per annum. This would have turned a $20,000 investment into a sizable $89,000 today.

Corporate Travel Management Ltd (ASX: CTD)

This corporate travel specialist has been a great place to invest over the last decade. During this time, Corporate Travel Management has gone from being a small cap flying largely under the radar into one of the leaders in the industry.

This has led to significant revenue and earnings growth, which has driven exceptionally strong returns for its lucky shareholders. And that’s despite the fact that its shares are trading nowhere near their pre-COVID highs. Since this time in 2012, Corporate Travel Management’s shares have generated an average total return of 23.4% per annum. This would have turned a $20,000 investment into a whopping $164,000 today.

The post $20,000 invested in these ASX shares 10 years ago is worth how much? appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Wednesday
• Here’s why brokers are bullish on these ASX growth shares
• What’s driving ASX 200 consumer shares on Tuesday?
• 5 ASX All Ords shares going ex-dividend on Wednesday
• 2 of the best ASX shares to buy now according to Morgans

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 recommended Corporate Travel Management Limited. 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.

Electric-vehicle (EV) pioneer Tesla, Inc. (NASDAQ: TSLA) is exploring the feasibility of developing a battery-grade lithium hydroxide refinery on the Gulf Coast of Texas or Louisiana, according to its late-August filing of an application seeking a property tax break in Texas.

Like other EV makers, Tesla’s supply chain is dependent on lithium — which has soared in price due to tight supply — because it’s used to produce the lithium-ion batteries that power EVs. Tesla also uses these batteries in its energy-storage products.

Here’s what investors should know.

Tesla’s proposed Texas lithium refining plant and timeline

In its application for a property tax break in Texas, here’s how Tesla described its proposed operation in Robstown, Nueces County, which is about 16 miles west of Corpus Christi (see map below):

Tesla, Inc. is evaluating the possible development of a battery-grade lithium hydroxide refining facility, the first of its kind in North America, as well as facilities to support other types of battery materials processing, refining, and manufacturing and ancillary manufacturing operations in support of Tesla’s sustainable product line.

Tesla will process raw ore material into a usable state for battery production. The process Tesla will use is innovative and designed to consume less hazardous reagents and create usable byproducts compared to the conventional process.

The final product, battery-grade lithium hydroxide, will be packaged and shipped by truck and rail to various Tesla battery manufacturing sites supporting the necessary supply chain for large-scale and electric vehicle batteries.

Tesla estimates the project will create 162 jobs. If it chooses the Robstown site, the company said construction could begin as early as the fourth quarter of 2022, and that it expects commercial operations would start by the fourth quarter of 2024.

A Louisiana site is in the running, too 

As is typical for large companies that are considering building a significant new facility, Tesla is shopping around for tax-break deals from U.S. states. 

In its Texas filing, it said the lithium “project could be located anywhere with access to the Gulf Coast shipping channel” and that it’s also evaluating a site in Louisiana.

The company specified that the final product — battery-grade lithium hydroxide — will be “shipped by truck and rail to various Tesla battery manufacturing sites,” so we can deduce that the Gulf shipping channel is likely needed for incoming raw materials. 

Currently, in the United States, Tesla manufactures its batteries for its EVs and energy-storage products at its Gigafactory Nevada, which it operates with partner Panasonic. The company also has plans to produce batteries at its new Gigafactory Texas, which is located just outside the Austin city limits. 

We can’t know which state will provide Tesla with the most attractive tax breaks. But all other things being roughly equal, Texas would seem the frontrunner since the company already has operations in the Lone Star State. Last year, Tesla relocated its global headquarters from California to the Austin area, and it’s currently ramping up EV production at Gigafactory Texas.

Tesla’s possible lithium refinery site in Robstown is less than 20 miles from the Port of Corpus Christi and less than 200 miles by vehicle from its existing Austin area factory. Any site in Louisiana that’s in close proximity to one of its seaports would be notably further away from Tesla’s current Texas operations, per my review using worldportsource.com. So unless the Pelican State’s economic package majorly dwarfs whatever Texas offers, it seems highly unlikely it will be home to a Tesla lithium refinery.

Tesla will also surely be evaluating weather factors, as hurricanes are not infrequent along the U.S. Gulf Coast.

Tesla’s potential lithium production plans aren’t a surprise

In the fall of 2020 at Tesla’s “Battery Day,” CEO Elon Musk announced the company had obtained the rights to 10,000 acres in Nevada where it planned to extract lithium from clay deposits using a proprietary process it had developed.

Tesla hasn’t disclosed what lithium feedstock it aims to use in the battery-grade lithium hydroxide refinery that it’s considering constructing. It’s possible the company has developed a clay extraction technique, though it doesn’t seem likely. No company is producing lithium from clay at commercial scale. (Lithium Americas is close to the commercialization stage at its lithium clay project in Nevada, but that project keeps being delayed by lawsuits from environmentalists and Native Americans.)

A more robust supply chain

Tesla having its own source of battery-grade lithium would be a positive for it and its investors. This would give it better control over its supply chain and lessen the probability that its business would be hurt by a global shortage of this critical battery material. Along with the availability benefit, it’s also possible that Tesla could reap a cost benefit, at least eventually. 

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

The post Tesla is exploring building a lithium refining plant in Texas appeared first on The Motley Fool Australia.

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More reading

• Why Tesla thumped the market today
• Why Tesla shares popped today
• Why Tesla stock dropped today
• Better buy: Tesla stock or a Nasdaq index fund?
• Why Tesla shares moved higher today

Beth McKenna 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 Tesla. 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.

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

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The Ethereum (CRYPTO: ETH) price didn’t exactly take off following yesterday’s completion of the long-awaited Merge.

The Merge, if you’re unfamiliar, has transitioned the Ethereum network away from a proof of work (PoW) protocol to a proof of stake (PoS) system.

The new PoS protocol sees validators stake some of their Ether holdings to earn rewards in return for verifying transactions and securing the blockchain. One of the most immediate advantages is the huge reduction in energy used, estimated at more than 99%, with far fewer computers required.

Many crypto investors also hope the Merge will light a fire under the Ethereum price.

As we mentioned, that didn’t happen yesterday. Ether tumbled more than 8% during Friday trading. Though it should be noted that most cryptos and risk assets came under selling pressure amid renewed fears of sharp rate hikes from the US Fed.

But in the months, and indeed years, ahead, the Merge looks like it might offer some strong tailwinds for the Ethereum price.

3 reasons the Merge could boost the Ethereum price longer-term

Addressing some of the bullish assessments around the Merge and its impact on Ethereum, Simon Peters, crypto market analyst at eToro said the Merge could potentially boost the Ethereum price for three reasons.

“Firstly, the issuance – the amount of new Ether entering circulation ­– will drop significantly, with estimates currently around a 90% fall,” he said.

“Secondly, a minimum fee must be paid to the network to execute transactions,” Peters said. “This fee will get ‘burned’ during the process, removing it from circulation. The burning of ETH from circulation will leave less of the crypto asset circulating in the system over time.”

As for the third aspect of the Merge that could boost the Ethereum price over time, Peters added, “Holders can begin staking – a form of passive reward for helping to secure the network. Again, this will take ETH out of the circulating supply.”

According to Peters:

In short, ETH could go deflationary. Less supply and more demand for ETH could cause the Ethereum price to rise post Merge as the scarcity begins to weigh on the token’s circulation, akin to when central banks raise interest rates and slow processes such as quantitative easing.

Of course, there are no guarantees in life. And generally, you’ll find two (or more) sides to every story.

Institutional investor skittishness

As cryptos were rocketing to fresh record highs in 2021, institutional investors began to take much more notice. More recently that interest has waned.

And it looks like the Merge may have caused some added angst amongst institutional investors.

“CoinShares recently released its weekly fund flows report, which showed a net outflow of ETH among institutional investors – albeit relatively small,” Peters said. “This could signal nervousness about technical issues that could arise with the Merge.”

Peters concluded:

Whether the Ethereum price will rise or fall on completion of the Merge, only time will tell. What is important though from a network development point of view, a significant milestone, years in the making, will finally be achieved.

Happy investing!

The post 3 reasons the Ethereum price could gain in the post-Merge months appeared first on The Motley Fool Australia.

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More reading

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• 5 reasons I wouldn’t touch Shiba Inu with a 10-foot pole
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• As stocks swoon, can crypto get its mojo back?

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 positions in and has recommended Ethereum. The Motley Fool Australia has positions in and has recommended Ethereum. 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 is fair to say many ASX share portfolios would be in the red this year.

Unless you were fortunate enough to plough your money into mining shares at the start of the year, your wealth-on-paper likely will have reduced in 2022.

Some stocks, especially high growth ones, have shrunk to a mere shadow of what they used to be in those glory years of 2020 and 2021.

It’s all good and well for commentators to espouse holding for the long term, but if your investment has fallen 80% during this bear market then it now needs to become a 5-bagger for you to merely break even.

Are you confident that’s even possible as interest rates continue to climb? As rates get higher, there’s a greater chance that the economy will crash into a nasty “hard landing”.

Couldn’t that money be put to better use?

According to Marcus Today senior market analyst Henry Jennings, this is why selling is so much more difficult than buying ASX shares.

“It is one of the hardest things to do and one of the most neglected,” he said on the Marcus Today blog.

“It came up as a question at the course I do for the kids the other night with one of the mums. She had bought a stock that had tanked and wanted to know when to sell.”

‘The market is bigger than you are. Always was, always is’

Selling is hard enough as it is. But when it comes to ASX shares that have plunged beyond recognition, the decision is even more difficult.

“How do you cut a losing position that has gone so bad that you cannot even bear to look at it?” asked Jennings.

“What do you do? Do you just cut and move on? Do you bottom-drawer it? It could be a lottery ticket without an expiry date? Frequently not. Or do you average down?”

The most important action in this position is to take the emotion out of it, according to Jennings. Focus on the original reasons for investing in this company. Do those factors still ring true?

Sometimes the investment thesis still holds, and the market has simply miscalculated the company’s worth.

“It does not always value things properly — so maybe, just maybe, the investment case still adds up,” said Jennings.

“But don’t be stubborn and don’t be so chock full of hubris that you think you are right no matter what. The market is bigger than you are. Always was, always is.”

Have a bet each way

For ASX shares that have fallen devastatingly, Jennings suggests a compromise.

First, you set what he calls a “sift stop loss” for that stock. That’s the share price at which he evaluates “if all the reasons I bought it for still hold”.

At this point if Jennings can’t quite decide whether to cut or hold, he decides to sell some — not all — of his holding.

“It makes me feel that I am doing something and if it keeps going down then I can buy back more at lower levels and if Sod’s Law comes into play and it bounces then I still have some.”

This method works for Jennings, but he freely admits it doesn’t suit everyone.

“My risk appetite is probably greater than others. I screen watch all day every day.”

He points out that investors are often afraid to exit a position as if they’re breaking up with a partner.

But selling is not goodbye forever, and ASX shares have no memory of how you treated them in the past.

“If you need to clear your mind, you can always sell and get back in again at another time,” said Jennings.

“You are not barred for life from a stock.”

The post What to do with an ASX share so devastated you can’t even look: expert appeared first on The Motley Fool Australia.

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More reading

• 3 reasons the Ethereum price could gain in the post-Merge months
• Brokers say these ASX 200 dividend shares are buys now
• 3 things the world’s smartest investors do in every bear market
• 2 fantastic ASX 200 shares analysts say are buys
• These ASX critical minerals companies just received millions in government grants

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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