Running your own SMSF makes a lot of sense if you fancy yourself as an investor as a few smart investments and you could really crank your superannuation balance.
The majority of SMSF investors are in or near the retirement stage so income is also a big priority and preferably of the fully franked variety given the cash refunds available under the current tax system look set to stay for good.
Blue-chip shares are also popular as SMSF investors tend to be larger players by retail standards and punting your retirement funds on high-risk small caps is not a sensible idea.
Recently, Australia’s leading retail broker by volume, Commsec, published a table of the 20 most popular shares traded by SMSF investors by value over the six-month period to June 30, 2019.
So let’s take a brief look at what businesses are in the top 10 of your average SMSF investor’s shopping list.
- Commonwealth Bank of Australia (ASX: CBA) is a blue-chip dividend favourite as Australia’s largest bank with the most successful share market track record. It took 5.7% of all trades recorded by SMSF investors.
- Westpac Banking Corp (ASX: WBC) is also favoured due to its term-deposit-thumping fully franked dividend yield.
- National Australia Bank Ltd (ASX: NAB).
- BHP Group Ltd (ASX: BHP) is a blue-chip mining favourite that has actually beaten the big banks in terms of trailing 12 month yield.
- Fortescue Metals Group Limited (ASX: FMG) is another miner turned dividend star, thanks to rising iron ore prices.
- Afterpay Touch Group Ltd (ASX: APT) is probably the hottest stock on the ASX right now.
- Australia & New Zealand Banking Group (ASX: ANZ) completes the big 4 and this shows just how much SMSF investors love their fully franked dividends.
- Macquarie Group Ltd (ASX: MQG) earns a lot of income overseas and consequently its dividends tend to be only around 40% franked. In compensation it has offered market-thumping capital growth since the GFC.
- Telstra Corporation Ltd (ASX: TLS) is the giant telco that has proven a dividend trap over the last 18 months. It has been forced to slash dividends on the back of falling average revenue per users int the mobile space and the NBN earnings hole.
- CSL Limited (ASX: CSL) earns nearly all its income overseas and pays unfranked dividends. However, it has offered monster capital growth to any investor on board over the last decade or more.
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They’re not the banks. Not Woolies or Wesfarmers or any of the “usual suspects.”
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Tom Richardson owns shares of AFTERPAY T FPO, CSL Ltd., and Macquarie Group Limited.
You can find Tom on Twitter @tommyr345
The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO and CSL Ltd. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited and Telstra Limited. The Motley Fool Australia owns shares of National Australia Bank Limited. 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.