I believe it’s important to always have a watchlist so you know what shares you would invest in if you had some money to put to work in the stock market.
When those shares are trading at an attractive price, you can pounce on them. These are four shares I have my eye on:
Altium Limited (ASX: ALU)
Altium has been one of the best shares to own over the past decade and I think it will keep doing well over the next decade.
It is rare to find businesses that truly transform their industries like Coca Cola, Google, Facebook, Amazon, Apple, CSL Limited (ASX: CSL) and so on.
Thinking you can’t make any money on a business that is predicting a large increase in market share, revenue and profit margins could be a mistake, particularly as it keeps growing it’s dividend payout to shareholders.
One of the best ways to beat the market these days is to go for the truly amazing companies, even if it looks expensive – which is a great lesson from Fool co-founder David Gardner.
Blue Sky Alternatives Access Fund Ltd (ASX: BAF)
Most readers will know the disaster that Blue Sky Alternative Investments Ltd (ASX: BLA) has gone through, but the listed investment company (LIC) Blue Sky Alternatives Access Fund could be a market-beater over the next year.
According to its latest monthly update, being February 2019, it had a pre-tax net tangible asset (NTA) value of $1.12 per share, compared to the share price of $0.83, which is a discount of 26%. If Wilson Asset Management do take over the business it’s quite foreseeable the discount could close considerably quite quickly.
WAM Microcap Limited (ASX: WMI)
WAM Microcap invests in the smallest shares on the ASX, typically ones with market capitalisations below $300 million. This is usually where hidden gems are located that could handily outperform the broader share market over the medium-term.
The share price is now trading at around NTA, which it hasn’t done so since the IPO. Over the next decade, WAM Microcap could be the best-performing WAM LIC and its attractive dividend is also a good selling point.
Vanguard FTSE Asia Ex Japan Shares Index ETF (ASX: VAE)
Asia might be the best place to be invested over the next century, and this ETF could be the clearest way to get exposure to that idea. Even Charlie Munger says China is probably the best place to invest at the moment.
The Asian middle class is growing in wealth and size, which could be a useful boost for many of the Asian shares based in China, Taiwan and India.
With a price/earnings ratio of just over 12 and an earnings growth rate of just under 12%, this looks like it could be the best ETF to buy today, particularly on a PEG ratio comparison.
I think all of the above shares have a good chance of outperforming the ASX index over the next five years, whilst also providing a decent income stream. At the current prices I am attracted to WAM Microcap and the Vanguard Asian ETF the most because of the diversification and tailwinds that small caps and Asia enjoy.
Want other growth and dividend ideas? These top ASX stocks could be great additions to your portfolio.
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Motley Fool contributor Tristan Harrison owns shares of Altium, VANGUARD FTSE ASIA EX JAPAN SHARES INDEX ETF, and WAM MICRO FPO. The Motley Fool Australia owns shares of Altium. 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.