There are few ETFs on the ASX with better growth potential than BetaShares Asia Technology Tigers ETF (ASX: ASIA) and BetaShares NASDAQ 100 ETF (ASX: NDQ), is it time to buy them? It could be. Firstly, for readers who don’t know, the NASDAQ ETF consists of the leading US tech shares listed in the US such as Facebook, Alphabet (Google), Amazon and Apple. The Asia Technology ETF consists of the Asian tech giants like Baidu, Alibaba, Tencent and Samsung. Both of these indices have suffered significantly in recent months. The NASDAQ ETF is down 8.5% over the past month and…
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It could be.
Firstly, for readers who don’t know, the NASDAQ ETF consists of the leading US tech shares listed in the US such as Facebook, Alphabet (Google), Amazon and Apple. The Asia Technology ETF consists of the Asian tech giants like Baidu, Alibaba, Tencent and Samsung.
Both of these indices have suffered significantly in recent months. The NASDAQ ETF is down 8.5% over the past month and the Asia Tech ETF is down 8.2% during the same time period. However, Asian shares have been falling for longer with worries about the worsening trade war between the US and China.
The best time to buy your favourite ideas is when they’re suffering from a specific issue and when the market is down as a whole too. You get a double discount.
Rising interest rates and bond rates in the US have hurt the valuations of nearly all shares. This is fair – when the risk-free rate of return is higher, shares are meant to be valued a little lower. That affects growth shares like Afterpay Touch Group Ltd (ASX: APT) and defensive shares like Transurban Group (ASX: TCL) alike.
However, with the US FAANG shares there has been growing political pressure with threats of breaking up the tech giants.
A number of share-specific issues are affecting the Chinese giants, with Chinese regulators having stopped approving new online games (hurting Tencent) and the JD.com CEO being arrested on allegations of rape.
Despite these issues, when you look at how our spending and viewing habits have changed it’s clear to see who has benefited over the past decade. I believe technology will be a clear winner over the next 10 years as well, so these two ETFs could be good choices for diversified bets. We just have to keep the ultra-long-term in mind with our investments.
At the current prices I am more drawn to the Asian Tech ETF, however it has much higher risks than a typical diversified ETF, so I wouldn’t want a large portion of my portfolio allocated to it.
Another share to take advantage of the big Asian economic opportunity is this ASX stock which is growing in Thailand.
You might not know this market leader's name, but it's rapidly expanding into a highly profitable niche market here in Australia. Even better, the shares boast a strong, fully franked dividend that should balloon in the years to come. In other words, we're looking at the holy grail of incredible long-term growth potential AND income you can watch accruing in your account in real time!
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Motley Fool contributor Tristan Harrison owns shares of BetaShares Asia Technology Tigers ETF. The Motley Fool Australia owns shares of and has recommended BETANASDAQ ETF UNITS and Transurban Group. The Motley Fool Australia owns shares of AFTERPAY T FPO and BetaShares Asia Technology Tigers ETF. 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 Scott Phillips.