I think it's important to always have a good idea of what shares you want to buy, a watchlist is a great idea.
When your desired targets come up at a good price you can then buy them without trying to spend time narrowing down what shares you're looking for.
These are three shares I want to buy next year but I'm hoping for better value than today:
WAM Microcap Limited (ASX: WMI)
WAM Microcap is one of the highest-performing listed investment companies (LICs) on the ASX. It targets shares with market capitalisations under $300 million at the time of purchase.
Over the past year its portfolio has grown by 30.6% before fees, taxes and expenses. That's an excellent performance, but it's very unlikely to be repeated in 2020. Small caps are generally more volatile, which provides great buying opportunities. However, I think over the next 12 months there will a time where I can buy WAM Microcap shares after a market dip rather than buying at close to all-time highs.
I'm attracted to WAM Microcap's attractive dividend payouts of growing ordinary dividends and special dividends.
There will be times when WAM Microcap shares drop heavily, more than the overall market, which I think will be a good opportunity to buy more shares.
Altium Limited (ASX: ALU)
I think it's best to focus our individual share investing efforts on the best businesses with long-term growth futures, good management, growing profit margins, a good balance sheet and so on.
Altium ticks all of the boxes in my opinion. Lots of investors think the same thing though, the electronic PCB software leader is trading pretty expensively with the market excited by its growth prospects thanks to the increasingly technological world.
It's one of my larger positions so I would only want to buy more shares at a good price. For me that would be at around $30 (or less) over the next six months with the current low interest rate environment. As its earnings grow my 'good price to buy' will rise too.
Magellan Global Trust (ASX: MGG)
There are a few quality large businesses on the ASX like CSL Limited (ASX: CSL), but there are many more opportunities out there in the global share market.
When I look at Magellan Global Trust's portfolio I see it full of businesses with good growth opportunities I'd be happy to have in my own portfolio like Alphabet, Facebook, MasterCard, Microsoft, LVMH and Visa.
It is consistently a strong performer, since inception in October 2017 its portfolio has returned an average of 16.8% per annum after fees.
I'm cautious about buying shares of Magellan Global Trust today with international share markets close to an all-time high. I also want to wait to buy shares until it's at a discount to its net asset value (NAV) per share, at the moment it's at a premium.
Foolish takeaway
I'd love to buy more shares of all of these businesses in 2020, but none of them are at great prices today.
Magellan Global Trust has the most investment flexibility because of its international mandate so I'd want to invest the most money in it if they were all at good value, but I think WAM Microcap could be the best one to buy at the right time.
