The Motley Fool

The best 4 stocks for a $10,000 portfolio

So you’ve got $10,000 saved up, and you’re itching to get into the stock market. You’ve got a brokerage account, and you’re all set – you just don’t know which stocks to buy.

Here’s where we can help.

Your aim is to beat the market right? Otherwise you might as well buy a listed investment company (LIC) or an exchange traded fund (ETF) index tracker, like the SPDR S&P/ASX 200 Fund, which tracks the performance of, you guessed it the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO).

I imagine you’d like a mix of dividends and growth, big solid companies and perhaps one or two ‘exciting’ stocks that could provide a kick-along to your portfolio. You also want a bit of diversity, so a mix of industries is called for.

Here are my picks for those four stocks…

Insurance Australia Group Limited (ASX: IAG)

IAG is paying a trailing fully franked dividend yield of over 6% and a forecast P/E ratio of just 11.1. The insurer has some of Australia’s most well-known brands including NRMA, CGU and SGIO. Growth should come not just from existing operations but also its newly acquired insurance underwriting business. So there you have a solid blue chip, with a mix of growth and income.

Telstra Corporation Ltd (ASX: TLS)

Currently paying a 5.2% fully franked dividend, the giant telco is walking all over its competitors. Growth should come from some of its smaller businesses, but it’s the legendary fully franked dividend that we’re mainly after with Telstra.

Coca-Cola Amatil Ltd (ASX: CCL)

The soft drink distributor has expanded into beer, water, soft drinks as well as other products and has massive potential in Indonesia. Hated by the market at the moment, investors have the perfect opportunity to buy a quality stock at a knock down price. The share price should resume its upward ascent as the company irons out its issues and the dividend is a bonus.

Nearmap Ltd (ASX: NEA)

Nearmap provides businesses and governments with high quality overhead photomapping, which is updated regularly. If you’re a council inspector and want to check whether trees are growing into residents’ yards? No problem – and it can be all done from your computer. And that’s just one of the many, many potential applications. Nearmap has begun trials in the US, and if it takes off, the current share price of 41.5 cents could be a ‘kick myself for missing the opportunity’ moment.

So there you have it. Four stocks offering a little bit of something for everyone.

5 stocks under $5

We hear it over and over from investors, "I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I'd be sitting on a gold mine!" And it's true.

And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!

*Extreme Opportunities returns as of June 5th 2020

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