Your instant 5-share ASX income portfolio

If you are looking for extra investment income, you should put Telstra Corporation Ltd (ASX: TLS) shares, Mantra Group Ltd (ASX: MTR) shares, Macquarie Group Ltd (ASX: MQG) shares, Sydney Airport Holdings Ltd (ASX: SYD) and the iShares S&P 500 ETF — found on Google Finance as ISCS&P500 CDI 1:1 (ASX: IVV) — on your watchlist.


Telstra shares have an estimated dividend yield of 6.5% fully franked. Including the benefit of those franking credits its dividend yield blows out to over 9%. The reason why Telstra’s shares offer such a big dividend can be put down to the recent selloff in the company’s share price. The $55 billion company has fallen 10% in the past month as investors grow concerned about mounting competition in the local broadband and mobiles markets, as well as rising interest rates.

Mantra Group

Mantra is another company to have suffered a selloff, falling 34% in a year. The company operates, owns and provides a number of other services to the Mantra and Peppers brand of hotels and resorts throughout Australia. While hotels can be tough businesses to operate profitably, Mantra has a relatively low-cost model. The key threat to its business is Airbnb, the peer-to-peer room-sharing service. However, with a 4.2% dividend yield, some investors might be beginning to think it looks like good value at these levels.

Macquarie Group

Macquarie is Australia’s largest investment bank, with operations across the globe. With the ongoing growth of the global economy, Macquarie continues to benefit. Although the Macquarie share price could be volatile — for example, it fell from almost $100 to below $20 during the Global Financial Crisis — the bank appears to be a good business to hold for the long term. It is forecast to pay a 4.6% partially franked dividend.

Sydney Airport Holdings

Like Mantra, Sydney Airport Holdings stands to benefit from the ongoing rise of international tourism. As the gateway for many travellers, both domestic and international, Sydney Airport takes a cut of the fare for every passenger that passes through its gates. Recently, the potential threat of a second airport in Western Sydney appears to have spooked investors. While Sydney Airport is busy deciding whether or not it will participate in its development and operation, the market does not like uncertainty. At these prices, it is forecast to pay a dividend of 5.3%.

iShares S&P 500 ETF

I’ve added this one for a little diversification. iShares S&P 500 ETF is an exchange traded fund or ETF that tracks all 500 U.S. companies included in the S&P 500 stock index. By buying units in the ETF, you get a tiny slice in each company. That includes any potential share price gains and dividends. It has a dividend yield of around 2%.

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Motley Fool Contributor Owen Raszkiewicz does not have a financial interest in any company mentioned. Owen encourages your feedback. You can follow him on Twitter @OwenRask.

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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