Are you looking for your first ASX share to buy? It can be a daunting task. You might have a dozen people telling you their ‘hot picks’. You might have no-one giving you advice at all, which would make investing seem even more intimidating.
Luckily, you’ve come to the right place! Here at The Fool, we love helping beginners out just as much as (perhaps even more than) those who are a little more advanced.
So, here are two ASX shares which I think would make great first investments.
BetaShares Australia 200 ETF (ASX: A200)
This share is actually an Exchange Traded Fund (or ETF) – meaning instead of being one company, it holds a whole bunch of them. Two hundred of the largest companies in Australia to be precise.
That means if you buy shares in the A200 ETF, you are really buying exposure to the likes of Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), BHP Group Ltd (ASX: BHP), Woolworths Group Ltd (ASX: WOW) and Telstra Corporation Ltd (ASX: TLS) alongside 195 others.
Think of it like being sick on the day of a test and just getting ‘the average mark’. That’s the kind of return an ETF like this offers. It won’t make you super rich, but this kind of investment is really a long-term bet on the Australian economy and should continue to give you a decent return over the long run.
A200 is also one of the lowest-cost ETFs available, with a management fee of just 0.07% per annum (or 70 cents for every $100 invested each year) – which is why I think it is a great ‘first share’ to buy.
Magellan High Conviction Trust (ASX: MHH)
Magellan High Conviction Trust is an ASX Listed Investment Trust (LIT) that invests in mostly US companies that its management team sees as most capable of outperforming in the future.
This trust operates in a similar way to an ETF like A200 but instead of ‘buying the whole market’, you will only get the companies that management selects as being ‘the best in the world’ (their words). At the current time, MHH has large positions in names like Microsoft, Facebook, Alphabet and Visa (all companies you’ve probably heard of already).
These are the companies that shape the world around us in our modern age, and I think Magellan High Conviction Trust is a great way for a beginner to get access to a slice of the action.
Our experts here at The Motley Fool Australia have just released a fantastic report, detailing 5 dirt cheap shares that you can buy in 2020.
One stock is an Australian internet darling with a rock solid reputation and an exciting new business line that promises years (or even decades) of growth… while trading at an ultra-low price…
Another is a diversified conglomerate trading over 40% off it's high, all while offering a fully franked dividend yield over 3%...
Plus 3 more cheap bets that could position you to profit over the next 12 months!
See for yourself now. Simply click here or the link below to scoop up your FREE copy and discover all 5 shares. But you will want to hurry – this free report is available for a brief time only.
Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors. Sebastian Bowen owns shares of Facebook, Magellan High Conviction Trust, and Telstra Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Facebook. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia has recommended Facebook. 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.