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Where I would spend $5,000 on ASX shares next week

It’s a tough time to have money in ASX shares right now with the S&P/ASX 200 Index (ASX: XJO) down over 30% from its highs in February.

Still, that doesn’t mean we shouldn’t be investing anymore. Ostriches stick their heads in the sand when times are tough, but not good investors. And I think of the share market as having a giant ‘30% off all stock’ sale right now.

So with that imagery in mind, here are three ASX shares I would consider buying next week with $5,000.

Sydney Airport Holdings Pty Ltd (ASX: SYD)

Sydney Airport is a company that has (understandably) been hit very hard by the coronavirus outbreak and subsequent travel bans. No doubt this infrastructure giant is going to have a very painful year of earnings this year, but I don’t think the long-term fundamentals have shifted too much. It remains the only international airport serving our biggest city and state – giving it enormous market power and monopolistic pricing control.

Thus, with a current share price around two-thirds of its 52-week high – and a trailing dividend yield of 6.32% – I think Sydney Airport is a great stock for the watchlist!

Vanguard Australian Shares High Yield ETF (ASX: VHY)

This exchange-traded fund (ETF) tracks a basket of the highest yielding ASX shares on the Aussie market today. And since four of its top holdings happen to be the ASX banks – its units are well and truly on sale right now (down 30% from its 52-week high on current prices).

VHY is offering a trailing, grossed-up yield of 7.8% at these prices, which I think is a great way to meet this new era of zero interest rates head on! If you’re after broad exposure to some of the best ASX dividend shares on the market, I think this ETF is a top choice for a $5,000 investment next week.

Afterpay Ltd (ASX: APT)

This former market darling has had a rough ride in this ASX 200 bear market – dropping from over $40 a share to under $10 and then back to $18 (where it sits today) in a matter of weeks. Still, if you fancy this volatility as an opportunity – this could be the perfect stock to play with.

It remains at the vanguard of the ‘buy now, pay later’ space and has recently seen huge success in both the US and UK markets after very successful launches. I myself am waiting for another dip to buy in, but each to their own!

5 stocks under $5

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And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!

*Extreme Opportunities returns as of June 5th 2020

Motley Fool contributor Sebastian Bowen owns shares of Vanguard Australian Shares High Yield Etf. The Motley Fool Australia owns shares of and has recommended Sydney Airport Holdings Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO. 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.

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